Ask Question
28 August, 03:59

Which of the following entries records the receipt of cash for two months' rent? The cash was received in advance of providing the service. a. Prepaid Rent, debit; Rent Revenue, credit b. Cash, debit; Rent Expense credit c. Cash, debit; Unearned Rent, credit d. Cash, debit; Prepaid Rent, credit

+2
Answers (1)
  1. 28 August, 04:11
    0
    C

    Debit cash, Credit unearned rent

    Explanation:

    This is a transaction that affects cash and unearned revenue account as the rent is not yet earned as being paid in advance. In other to avoid overstatement of income as the accrual system specify that income should be recorded when earned, the transaction is recorded in the unearned account.

    An increase in the cash account is recorded as a debit entry while an increase in the unearned revenue account is a credit entry. Therefore, the cash account is debited with the cash collected and the unearned account credited with the same amount.
Know the Answer?
Not Sure About the Answer?
Find an answer to your question ✅ “Which of the following entries records the receipt of cash for two months' rent? The cash was received in advance of providing the service. ...” in 📘 Business if you're in doubt about the correctness of the answers or there's no answer, then try to use the smart search and find answers to the similar questions.
Search for Other Answers