Rachel manufactures surgical gloves. Upon receiving an order from a hospital for supplying them with their requirements for five years ending on 31st December 2021 for total value of 50,000 , she raised an invoice for 5,000 and has accounted for it by crediting Sales account and debiting Receivables account on 30th Jan 2017. For preparing the financial statements in respect of the year ended 31st December 2019 the adjusting entries required are (FY 17 Books were closed and there was no error in FY17 Financials):

1. Credit Sales account & Debit Deferred income account with 30,000
2. Debit Sales account & credit deferred income account with 30,000
3. Entry is not required as the same was accounted at billing.
4. Debit sales account & credit deferred income account with 20,000