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 December 31,2011?

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Quizplus · Accepted Answer

By December 31, 2011, Enoch, Inc. would have earned 5 months of the service revenue (August to December), which is $5,000 ($12,000/12 months * 5 months). Therefore, the unearned revenue remaining would be $7,000 ($12,000 - $5,000).

Enoch,IncBegan Operations on July 1,2011