Pattie's Event Planning Service has just prepared the unadjusted trial balance, which shows the following balances: Salary expense: Debit $8 000 Service revenues: Credit $3 000 Interest expense: 0
Late in this month, she began working with a new client, providing event planning services for an upcoming event. When the event is complete, in the following month, she will collect the full amount of $900 from her client. As of the end of this month, she has rendered one- third of the services covered by the contract. She makes accrual adjustments monthly. The final adjusted balance of Service revenues, as shown on the adjusted trial balance, should be a:
A)credit balance of $3 300.
B)debit balance of $300.
C)debit balance of $3 300.
D)credit balance of $3 900.

Question

Quizplus · Accepted Answer

The service revenue should be adjusted for the portion of services rendered. One-third of $900 is $300, which should be added to the unadjusted service revenue of $3,000, resulting in an adjusted credit balance of $3,300.

Pattie's Event Planning Service Has Just Prepared the Unadjusted Trial