Jane Richards, CGA, has performed $2,000 of accounting services for a client but has not billed the client as of the end of the accounting period. What adjusting entry must Jane make?
A) debit Cash and credit Unearned Revenue
B) debit Accounts Receivable and credit Unearned Revenue
C) debit Accounts Receivable and credit Service Revenue
D) debit Unearned Revenue and credit Service Revenue

Question

Quizplus · Accepted Answer

Jane must recognize the revenue she has earned by debiting Accounts Receivable, indicating she expects to receive payment, and crediting Service Revenue, reflecting the income earned from services provided, even though she has not yet billed the client.

Jane Richards, CGA, Has Performed $2,000 of Accounting Services for a Client