Vista newspapers sold 4,000 of annual subscriptions at $125 each on September 1.How much unearned revenue will exist as of December 31?

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Unearned revenue is the amount of money received in advance for services that have not yet been performed. In this case, Vista newspapers sold 4,000 annual subscriptions at $125 each on September 1. This means that they received $500,000 in advance for services that will be performed over the next 12 months. As of December 31, three months have passed, so 1/4 of the services have been performed. This means that $125,000 of the unearned revenue has been earned, and $375,000 remains unearned.

Vista Newspapers Sold 4,000 of Annual Subscriptions at $125 Each