When a magazine company receives advance payment for a subscription,what is the required journal entry to be recorded?
A) Cash - Debit; Unearned Subscriptions Revenue - Credit
B) Accounts Receivable - Debit; Unearned Subscriptions Revenue - Credit
C) Cash - Debit; Subscriptions Revenue - Credit
D) Subscriptions Revenue - Debit; Cash - Credit

Question

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When a magazine company receives advance payment for a subscription, the payment is initially recorded as unearned revenue. This is because the company has received payment but has not yet fulfilled their obligation to deliver the magazines. Therefore, the journal entry should be: Cash -Debit (as cash is increasing), Unearned Subscriptions Revenue - Credit (as unearned revenue is decreasing).

When a Magazine Company Receives Advance Payment for a Subscription,what