Enoch,Inc.began operations on July 1,2011.On August 1,it received $12,000 in advance for services to be performed evenly over the next 12 months.How much unearned revenue should the company report on its balance sheet at August 31,2011?

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Quizplus · Accepted Answer

The company received $12,000 in advance for services to be performed evenly over the next 12 months, which means they earned 1/12th of that revenue for the month of July. Therefore, the amount of unearned revenue that they should report on their balance sheet at August 31, 2011 is $11,000 (12,000 - 1,000).

Enoch,IncBegan Operations on July 1,2011