On October 1, the company received 6 months' rent in advance from a tenant whose rent is $700 per month. The $4,200 was credited to the unearned rent account. Record the adjustment necessary to recognize three month's rent
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On October 1, the company received 6 months' rent in advance from a tenant whose rent is $700 per month. The $4,200 was credited to the unearned rent account. Record the adjustment necessary to recognize three month's rent
First you need to take $700 times three months equals $2,100 for three months rent, now you have the amount needed to do the adjusting entry. Your adjusting entry will be:
Debit Unaerned Rent Revenue for 2,100
Credit Rent Revenue for 2,100
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