A transaction has been recorded in the general journal of Manella Company as follows:

Which of the following could be an explanation for this transaction?
A)Paid cash to a customer who requested a refund.
B)Received cash in advance for work to be performed in future months.
C)Recorded adjusting entry for work completed.
D)Received cash for services completed.

Question

A transaction has been recorded in the general journal of Manella Company as follows:

Which of the following could be an explanation for this transaction?
A)Paid cash to a customer who requested a refund. 
B)Received cash in advance for work to be performed in future months. 
C)Recorded adjusting entry for work completed. 
D)Received cash for services completed.

Quizplus · Accepted Answer

The debit to Cash increases this asset account and the credit to unearned revenue increases this liability account.That would be the journal entry recorded when cash is collected as an advance for work to be performed in the future.

A Transaction Has Been Recorded in the General Journal of Manella