On the 15thof the month,a company receives $8,000 in payments from customers.$1,000 is for services performed on that day and the remaining is payment for services performed in the previous month.The $8,000 cash receipt would be recorded as a:
A)debit of $7,000 to Accounts Receivable,debit of $1,000 to Service Revenue,and a credit of $8,000 to Cash.
B)debit of $8,000 to Cash,a credit of $7,000 to Accounts Receivable,and a credit of $1,000 to Service Revenue.
C)debit of $7,000 to Accounts Receivable,a debit of $1,000 to Unearned Revenue,and a credit of $8,000 to Cash.
D)debit of $8,000 to Cash,debit of $1,000 to Service Revenue,and a credit of $7,000 to Accounts Receivable.

Question

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The $8,000 cash receipt is recorded as a debit of $8,000 to Cash. $7,000 of the payment is for services performed in the previous month, which would decrease the balance in Accounts Receivable, so a credit of $7,000 is made to Accounts Receivable. The remaining $1,000 is for services performed on that day, which increases revenue and is recorded as a credit of $1,000 to Service Revenue.

On the 15thof the Month,a Company Receives $8,000 in Payments