Asked by Hunter Thomason on Jul 17, 2024
Verified
On November 1, clients of Great Designs Company prepaid $4,250 for services to be provided in the future at a rate of $85 per hour.
(a) Journalize the receipt of cash.(b) As of November 30, Great Designs shows that 15 hours of services have been provided on this agreement. Prepare the necessary journal entry.(c) Determine the total unearned fees in hours and dollars at November 30.
Prepaid Services
Expenses paid in advance for services which will be received in the future.
Unearned Fees
Income received by a company for services yet to be provided or completed; recognized as a liability until the service is performed.
Journalize
The process of recording financial transactions in the chronological order in a company's general journal.
- Recognize the rationale and procedure involved in the registration of adjusting entries in the accounting cycle.
- Observe and produce journal entries for a multitude of adjusting entries, like prepayments, accruals, and depreciation.
- Acquire knowledge on the treatment of unearned and accrued revenues in the accounting cycle.
Verified Answer
TR
Learning Objectives
- Recognize the rationale and procedure involved in the registration of adjusting entries in the accounting cycle.
- Observe and produce journal entries for a multitude of adjusting entries, like prepayments, accruals, and depreciation.
- Acquire knowledge on the treatment of unearned and accrued revenues in the accounting cycle.