On September 1,Peterson Maintenance Company contracted to provide monthly maintenance services for the next eight months at a rate of $2,600 per month.The client paid Peterson $20,800 on September 1.Assuming Peterson records deferred revenues using the alternative treatment,what would be the entry on September 1?
A) Debit Cash and credit Unearned Revenue for $20,800
B) No entry is needed until the services are performed
C) Debit Cash and credit Service Revenue for $20,800
D) Debit Prepaid Maintenance and credit Cash for $20,800
Correct Answer:
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