Management Services,Inc.provides services to clients.On May 1,a client prepaid Management Services $60,000 for 6-months contract in advance.Management Services' general journal entry to record this transaction will include a

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The journal entry should be recorded with a credit to Unearned Management Fees for $60,000 because the client has paid in advance for services that have not yet been performed. This creates a liability for Management Services, meaning they have an obligation to provide the services paid for. The journal entry would also include a debit to Cash for $60,000 to record the receipt of payment.