On January 1,Eastern College received $1,200,000 from its students for the spring semester that it recorded in Unearned Tuition and Fees.The term spans four months beginning on January 2 and the college spreads the revenue evenly over the months of the term.Assuming the college prepares adjustments monthly,what amount of tuition revenue should the college recognize on February 28?
A)$300,000.
B)$600,000.
C)$800,000.
D)$900,000.
E)$1,200,000.

Question

Quizplus · Accepted Answer

The college recognizes $300,000 each month ($1,200,000 / 4 months). By February 28, two months have passed, so it should recognize $300,000 for January and $300,000 for February, totaling $600,000. However, the question asks for the amount recognized on February 28, which refers to the revenue for February alone, hence $300,000.

On January 1,Eastern College Received $1,200,000 from Its Students for the Spring