If a company records cash received for services to be provided in the future with a debit to Cash and a credit to Service Revenue,how will this error affect total assets for the current period?
A)Total assets will be too low.
B)Total assets will be correct.
C)Total assets will be too high.

Question

Quizplus · Accepted Answer

Recording cash received for services to be provided in the future with a debit to Cash and a credit to Service Revenue does not affect the total assets for the current period because it increases both an asset (Cash) and a revenue (Service Revenue), leaving the total assets unchanged.

If a Company Records Cash Received for Services to Be