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    achilla's Avatar
    achilla Posts: 3, Reputation: 1
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    #1

    Jul 22, 2012, 02:40 AM
    Need the adjusting Journal Entries of the following. Please ASAP
    On November 30, 2012, the end of fiscal year, the following information is available to enable you to prepare Edgar Detoya Company's adjusting entries:

    A. On September 1, the company completed negotiations with a client and accepted an advance of P168, 000 for services to be performed the next year. The P168, 000 was credited to unearned Service revenues

    B. The company calculated that as of November 30. It had earned P40, 000 on an P110,000 contract that would be completed and billed in January.
    pready's Avatar
    pready Posts: 3,197, Reputation: 207
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    #2

    Jul 22, 2012, 07:34 AM
    A. The original journal entry is: Debit Cash for 168,000
    Credit Unearned Service Revene for 168,000

    There will be no adjusting entry required because none of the unearned service revenue has been earned.

    B. The adjusting entry is:
    Debit Unearned Service Revenue for 40,000
    Credit Earned Service Revenue for 40,000
    achilla's Avatar
    achilla Posts: 3, Reputation: 1
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    #3

    Jul 24, 2012, 06:27 AM
    Quote Originally Posted by pready View Post
    A. The original journal entry is: Debit Cash for 168,000
    Credit Unearned Service Revene for 168,000

    There will be no adjusting entry required because none of the unearned service revenue has been earned.

    B. The adjusting entry is:
    Debit Unearned Service Revenue for 40,000
    Credit Earned Service Revenue for 40,000
    Thank you. It is a very big help :))
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