Question
So I have this homework question that is driving me nuts. At the end of 2016, Framber Company received $8,000 as a prepayment for renting
So I have this homework question that is driving me nuts.
At the end of 2016, Framber Company received $8,000 as a prepayment for renting a building to a tenant during 2017. The company erroneously recorded the transaction by debiting Cash and crediting Rent Revenue in 2016 instead of 2017.
Upon discovery of this error in 2017, what correcting journal entry will Framber make? Ignore income taxes. Assume a full year of rent revenue is earned.
So I have done the two entries as:
Date Account Title Debit Credit
Dec. 31 Rent Revenue $8,000
Retained Earnings $8,000
It appears that the account titles are correct but the amounts are incorrect. What am I missing?
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