E3-11 Adjustment for unearned revenue For a recent year, Microsoft Corporation r

Question

E3-11 Adjustment for unearned revenue For a recent year, Microsoft Corporation reported short-term unearned revenue of $18,653 million. For the same year, Microsoft also reported total revenues of $73,723 million a. Assuming that Microsoft recognized $6,000 million of unearned revenue as revenue during the year, what entry for unearned revenue did Microsoft make during the year? Indicate each account affected, whether the account is increased or decreased, and the amount of the increase or decrease. b. What percentage of total revenues is the short-term unearned revenue? Round to one decimal place.

Explanation / Answer

Part A

Part B

25.30% (18653/73723) percentage of total revenues is the short-term unearned revenue.

Account titles and explanation debit credit Unearned Revenue 6000 Revenue 6000

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