On August 1 of the current year, Trevor Beck received $5400 for legal services to be performed evenly throughout the next six months. The adjusting entry on December 31 of the current year would include a:

Question

Quizplus · Accepted Answer

Trevor Beck received $5400 for services to be performed over six months, which means $900 is earned each month. By December 31, five months have passed, so $4500 ($900 x 5) of the revenue has been earned. The adjusting entry would credit Service Revenue for $4500 to recognize the earned revenue.

On August 1 of the Current Year, Trevor Beck Received