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trivadi · May 28, 2006, 11:38 AM

I received a check today for $ 6,000 from providence country club to photograph events held at the club over the next 12 months.

This is the journal entry I did, please let me know whether it is correct.

Cash 6000
Unearned revenue 6000

This is the final trial balance adusting entry question.

Adjust unearned photographic service revenue for September. Assume photographic revenue is earned evenly over the entire month.

I am confused by the question. Please help me.

CaptainForest · May 28, 2006, 12:50 PM

Your JE of

Cash 6000
Unearned revenue 6000

is correct.

As to your second question, I need to know 2 things
1) The above JE, when was the cash received?
2) When is the year end, end of September i take it?

Assuming you received the Cash in February, then you would journalize the months used up.

So - Feb, Mar, Apr, May, June, July, Aug, Sept = 8 months

So take 8/12 of 6,000 which is $4,000

Dr. Unearned Revenue 4,000
Cr. Revenue 4,000

You now have 4 months left to allocate (Oct, Nov, Dec and Jan).

This info is based on a Feb date, obviously it will changed if the cash wasn't received in Feb.

trivadi · May 28, 2006, 04:38 PM

Thank you very much for the answer.

Cash was received on Sept 1, 200x

CaptainForest · May 28, 2006, 07:43 PM

Then you would just record 1 month of revenue

6,000 x 1/12 = $500