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mjacobson86
Feb 9, 2009, 10:08 AM
How would you put this entry?

Jim Bob Grocery Store paid Eric $1,800 in advance for six months of cleaning services to be performed monthly, at the end of every month. The monthly charge to Jim Bob Grocery is $300.

This is what I have, please let me know what you think.

Cash $1,800
Unearned Revenue $1,800

codyman144
Feb 9, 2009, 10:59 AM
Looks right if you are doing the entry for Eric.

Please post these in homework help:


Finance & Accounting - Ask Me Help Desk (https://www.askmehelpdesk.com/finance-accounting/)

pready
Feb 9, 2009, 06:41 PM
The correct entry is:
Debit Prepaid Cleaning service Expense (or appropriate Prepaid expense account) for the amount
Credit cash for the amount (cash paid)