ABC Co. performed $5,000 of consulting work. Their customer paid them $3,500 right away and agreed to pay the balance in 30 days. Select the correct journal entry from the options below to record the transaction:
A)a debit to Cash for $3,500, a debit to Accounts Receivable for $1,500 and a credit to Capital for $5,000.
B)a debit to Cash for $3,500 and a credit to Fees Income for $3,500.
C)a debit to Fees Income for $5,000, a credit to Cash for $3,500 and a credit to Accounts Receivable for $1,500.
D)a debit to Cash for $3,500; a debit to Accounts Receivable for $1,500 and a credit to Fees Income for $5,000.

Question

Quizplus · Accepted Answer

- A debit to Cash for $3,500 reflects the amount received right away.
- A debit to Accounts Receivable for $1,500 represents the amount owed by the customer that will be received later.
- A credit to Fees Income for $5,000 represents the amount of consulting work performed by the company.

ABC Co Performed $5,000 of Consulting Work