Betly Inc. performs monthly cleaning services for a client for $1,200 per month.

Question

Betly Inc. performs monthly cleaning services for a client for $1,200 per month. At December 31, 2015 they have not been paid for the month of December and no entry has been made concerning the December services provided. A)What adjusting entry should be made at 12/31/15 Cr B)What effect does this entry have on the accounting equation? Assets LiabilitiesEquity C) If the payment for the December services is received on January 10, 2016, what journal entry is made on January 10 to record the payment? Dr Cr D)What effect does this entry have on the accounting equation? Assets ilities Equity

Explanation / Answer

a) Journal entry :

b) Accounting equation :

c) Journal entry :

d) Accounting equation :

Cash 1200

Account receivable -1200

Date accounts & explanation debit credit dec 31,2015 Account receivable 1200 Service revenue 1200 (To record accured revenue)

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