Question
Lee Company has employed a bookkeeper who is inexperienced. On December 30, after reviewing the records for the year, you discover the following error. On
Lee Company has employed a bookkeeper who is inexperienced. On December 30, after reviewing the records for the year, you discover the following error.
On September 1, Lee Company received $830 for services to be performed in the future. The bookkeeper recorded this by debiting Cash for $380 and crediting Service Revenue for $380.
Note: Assume that it is the company's policy to record the receipt of revenue in advance of earning it in the Deferred Revenue account.
Required: Prepare a correcting entry on December 30. Make sure to enter the day for each separate transaction.
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Fundamentals of Financial Management
Authors: Eugene F. Brigham
Concise 9th Edition
978-1305635937
