[jennyd1116]

On a Adjusted trial balance sheet dor Dec 31,2009 how would you post this question.
On Nov 1 the school agreed to do a special six-month course(starting immediately) for a client. The contract calls for a monthly fee of $2,400, and the client paid the first five months' fees in advance. When the cash was received, the Unearned Training fees account was creditied. The fee for the sixth month will be recorded when it is collected in 2010.

[morgaine300]

Vocabulary - you don't post entries, you journalize them. You don't post or journalize to a trial balance. And you don't do adjusting entries at all once an adjusted trial balance is done.

The unadjusted trial balance is done first. Then you make adjusting entries. Then you re-balance all of the accounts, accounting for any changes that happened in the adjusting entries. Then you do an adjusted trial balance. ("Adjusted" means it's already been adjusted.)

Now, that out of the way... (I get picky about that stuff, because it can cause confusion when people ask questions and call things by incorrect names)

On Nov 1 $12,000 (2400 x 5 months) in cash was received, which was an advanced payment for work that had not yet been done. When you receive cash in advance of earning something, it credits into a unearned revenue account. (In this problem called Unearned Training Fees.) That is a liability account, representing what you still "owe" to the client in the way of work. Liabilities do not have to be cash owed (like a payable), but any obligation. This is an obligation to five months that was already paid.

At the end of the year, two months of it would have been earned and that obligation met. How much is 2 months' worth? Therefore, how much have they now earned? The entry will do two things: one, remove two months of obligation because that portion no longer exists, and two, recognize the earnings for the two months.

How do you remove a liability and how do you record earnings?