People magazine sells annual subscriptions. The magazine subscription fees were collected in advance and had a balance of $5,000,000 on December 31, 2015. The magazine received $3,5000,000 in cash from subscribers in the year 2016. Also, magazine subscription revenue reached $6,000,000 in the same year. How much should People Magazine report as the balance for magazine subscriptions collected in advance (i.e., unearned revenue) in its December 31, 2016 balance sheet?

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To determine the balance for magazine subscriptions collected in advance unearned revenue on the D... View the full answer