2. Accrual Based Accounting Adjusting Journal Entries (AJEs): Globex Gym, Inc. receives a total cash payment in advance of $1,080 on 9/1/2020 from a customer, Clyde, for an annual gym membership covering the period of 9/1/2020 8/31/2021 (i.e. $1,080 = $90 per month for 12 months).

a. Record the journal entry Globex Gym would make on September 1st, 2020 when it receives the $1,080 cash payment from Clyde.

b. Record the adjusting entry Globex Gym would make to recognize Service Revenue on December 31^st, 2020. Assume Globex Gym uses an annual accounting period which ends on December 31^st, 2020 and adjusting entries are only made at the end of the annual accounting period on 12/31 (i.e. assume no adjusting entries have been recorded yet).

c.Calculate the adjusted balances of both the Deferred Revenue account and the Service Revenue account as of 12/31/2020. Assume the balances of the Deferred Revenue account and the Service Revenue account as of 9/1/2020 were both $0 and there are no other transactions.