Using the data in BE4.7 , journalize and post the entry on July 1 and the adjusting
Question:
Using the data in BE4.7 , journalize and post the entry on July 1 and the adjusting entry on December 31 for Marsh Insurance Co. Marsh uses the accounts Unearned Service Revenue and Service Revenue.
Data from Be 4.7
On July 1, 2022, Ling Co. pays $12,400 to Marsh Insurance Co. for a 2-year insurance contract. Both companies have fiscal years ending December 31. For Ling Co., journalize and post the entry on July 1 and the annual adjusting entry on December 31.
Step by Step Answer:
July 1 Dec 31 Cash 1231 Unearned Service ...View the full answer
Financial Accounting Tools for Business Decision Making
ISBN: 978-1119493631
9th edition
Authors: Paul D. Kimmel, Jerry J. Weygandt, Donald E. Kieso
Related Video
Unearned revenue is money received by an individual or company for a service or product that has yet to be provided or delivered. It can be thought of as a \"prepayment\" for goods or services that a person or company is expected to supply to the purchaser at a later date. As a result of this prepayment, the seller has a liability equal to the revenue earned until the good or service is delivered. This liability is noted under current liabilities, as it is expected to be settled within a year.
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