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College Accounting (Book Only): A ...

13th Edition
Scott + 1 other
ISBN: 9781337280570

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Section
BuyFindarrow_forward

College Accounting (Book Only): A ...

13th Edition
Scott + 1 other
ISBN: 9781337280570
Textbook Problem

Assume that a college receives $84,000 for one semester’s dormitory rent in advance and an entry is made debiting Cash and crediting Unearned Rent. At the end of the year, $68,000 of the rent has been earned. What adjusting entry would be made?

To determine

Prepare adjusting entry for rent earned.

Explanation

Adjusting entries: Adjusting entries are those entries which are recorded at the end of the year, to update the income statement accounts (revenue and expenses) and balance sheet accounts (assets, liabilities, and stockholders’ equity) to maintain the records according to accrual basis principle.

Prepare adjusting entry for Rent earned.

Date Account Title and explanation

Debit

($)

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