Sussex Ltd is a company that provides consulting services for firms in the wine making industry. On 1 March 2015 Sussex Ltd receives a non-refundable upfront fee of $120,000 in cash from Harrington Ltd. Under the agreement with Harrington Ltd, Sussex Ltd must provide on-going advice services until 1 March 2016. Sussex Ltd team of advisers that works on the Harrington advisory engagement is paid $5,000 a month. Sussex Ltd has a financial year-end date of 30 June.

1- Write down the journal entry (if any) in Sussex Ltd’s ledger in relation to the non-refundable upfront fee from Harrington on 1 March 2015.

2- As of 30 June 2015, indicate which of Sussex Ltd accounts has been impacted, and by how much, with respect to the advisory engagement with Harrington Ltd (ignore any tax impact):

Answer rating: 100% (QA)

Journal entries 1 date explanation debit credit mar 1 2015 cash 120000 unearned service revenue ... View the full answer