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20 March, 17:57

Which journal entry reflects the adjusting entry needed on December 31?:In November, BOC received a $5,000 cash deposit from a customer for custom-build goods that will be delivered in January (BOC recorded an entry for this $5,000 in November). Now, it is December 31, the end of the fiscal year. Dr. Unearned Revenue 5,000Cr. Inventory 5,000No entry needed. Dr. Cash 5,000Cr. Revenue 5,000Dr. Advances from Customers 5,000Cr. Revenue 5,000Dr. Unearned Revenue 5,000Cr. Revenue 5,000

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  1. 20 March, 21:32
    0
    No adjusting entry required

    Explanation:

    When the contract was formed and advance was received the company must had recorded the following entry:

    Dr Cash Account $5000

    Cr Unearned Revenue $5000

    Now it is the year end and till now the goods are not delivered which means advance that was received is still our unearned revenue So no further entry is required until the delivery of the goods ordered to the customer.

    Correct entry is "No adjusting entry required"
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Home » Business » Which journal entry reflects the adjusting entry needed on December 31?:In November, BOC received a $5,000 cash deposit from a customer for custom-build goods that will be delivered in January (BOC recorded an entry for this $5,000 in November).
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