Avelar Services Inc. signed a 6-month contract to provide services to a customer for $8,000. The services will begin on October 1, 2020 and end on March 31, 2021. The services will be performed evenly over the six-month period, and the customer will pay for the services on March 31, 2021. Assuming no journal entries for this contract were made in 2020, what adjusting journal entry should Avelar Services Inc. record for this contract on December 31, 2020?

Group of answer choices

Debit accounts receivable for $8,000, Credit service revenue for $8,000.

Debit cash for $4,000, Credit service revenue for $4,000.

Debit accounts receivable for $4,000, Credit service revenue for $4,000.

Debit service revenue for $4,000, Credit accounts receivable for $4,000.