Exercise 8-69 (Algorithmic) Uneamed Revenue Long Beach Exterminators signed a $2

Question

Exercise 8-69 (Algorithmic) Uneamed Revenue Long Beach Exterminators signed a $2,210-per-month contract on November 1, 2019, to provide pest control services to rental units owned by Palmdale Estates, Long Beach received 3 months' service fees in advance, on signing the contract. Required: 1. Prepare Long Beach's journal entry to record the cash receipt for the first 3 months. Nov. 1 Cash Y 6,630 Unearned Sales RevenueY (Record receipt of payment for services not yet performed) 6.630 2. Prepare Long Beach's adjusting entry at December 31, 2019. Dec. 31 Unearned Sales Revenue 4420 Sales Revenue (Record recognition of revenue) 4.420 3. Conceptual Connection: How would the advance payment [accounts) and amount s)] be reported in Long Beach's December 31, 2019, balance sheet? Unearned sales revenue in the amount of 4,420 X would appear among Long Beach's current liabilities . How would the advance payment [account(s) and amount(s)] be reported in Palmdale Estates' December 31, 2019, balance sheet? A prepaid asset in the amount of 6,630 uld appear among Palmdale Estates current assets

Explanation / Answer

3) Unearned sales revenue in the amount of $2210 would appear among long beach's current liabilities

A prepaid asset in the amount of $2210 would appear among Palmdale estates current assets

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