On 19 December 2022 Upbeat Ltd received $55,000 cash from a customer in payment for special purpose tubing that is to be manufactured and shipped to the customer in February 2023.

Required:

a. Identify if an asset, liability, revenue or expense should be recognized in the year ending 31 December 2022. In no more than 100 words justify your answer. (3 marks)

b. Prepare the journal entry to record the transaction. Ignore GST (1 Mark)

(Narrations in the general journals are not required. Both account names and figures should be correct in order to award marks. Type your response directly in the text box below.)