X Company prepares monthly financial statements. On January 1, a customer paid X

Question

X Company prepares monthly financial statements. On January 1, a customer paid X Company $21,900 in advance for cleaning services to be performed during the following three months, once in January, once in February, and once in March. What will be the result of the January 31 adjusting entry on X Company's financial statements?

revenue of $7,300 reported on the Income Statement
a $7,300 increase in the Deferred Revenue account on the Balance Sheet
a balance of $7,300 in the Deferred Revenue account on the Balance Sheet
a $7,300 decrease in the Cash account on the Balance Sheet
a $7,300 decrease in the Retained Earnings account on the Balance Sheet
a $7,300 increase in the Cash account on the Balance Sheet

Explanation / Answer

a. revenue of $7,300 reported on the Income Statement.

Related Questions

Navigate

• Browse (All)
• Browse X
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.