[accountingmajor]

Hello: I am new to this site. I am coming across some difficulty with my assignment. If someone can please help me:confused:

1. On may 1st, there was a rent payment for may and June for 4500.

THEN

2. I have an adjusting entry for a $1000 of unearned rent.

Here is the confusing part to me. I know I would have to first put an entry for

DR Prepaid Rent 4500
Cr Cash 4500

And an adjusting entry for

DR Rent Expense 2250
CR Prepaid Rent 2250...

BUT NOW, what do I do with the other adjusting entry for the unearned rent of 1000...


PLEASE CAN SOMEONE HELP ME OUT..

[morgaine300]

It's difficult to say because of the way you worded it.

Does the problem say something like "Unearned rent on May 31 is $1000"? If that is the case, what they are saying is that the amount of unearned rent equals $1000 and that that's what should be in the account as of that date. I can't say what the entry would be, because I need to know what the current balance in the account is. But let's say there's $3000 in that account. That represents what was already paid to the company prior to 5/31. As of 5/31 there's $1000 in unearned. That means $2000 of what was in there has now been earned. The idea is to "fix" the balance of that account to reflect the $1000 that is still unearned.

So you'd have to debit $2000 out of unearned rent and credit it into rent revenue.

[ibrahim.k]

rent unearned journal entry given below

rent a/c... DR

To earned income

note:
rent a/c = indirect income
unearned a/c =income (current liabilities)
p&L a/c = credit side (less rent)
balansheet = liability side

[ter07]

Your original entry is wrong...

It should be dr-Cash 4500 and cr- Unearned Rental Revenues 4500

And the adjusting entry would be

Dr- Unearned Rental Revenues-2200 and cr- Rental revenues- 2200

-ter07