Trixie Knitting Corp. publishes a magazine called Not Just Normal Knitting. As of the beginning of December, it had a current liability of $30,000 for unearned revenue due to magazine sales. On December 5th, it created and mailed out the January edition of the magazine. Subscribers to the magazine had paid $20,000 for the January magazines, which had been correctly included in unearned revenue. The accountant correctly recorded the cost of goods sold for these magazines, but neglected to make any other entries relating to the mail-out.

Current Assets NE Current Liabilities (O) 20,000 Long-term Assets NE

Retained Earnings (U) 20,000 Net Income (U) 20,000

Why the anwser is like this?