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1. On September 31st, Nook received a prepayment of $20,000 cash for a contract with the...

1. On September 31st, Nook received a prepayment of $20,000 cash for a contract with the following details:

  • Sale of 100 widgets
  • Sale of 100 1-year subscriptions of Widget Monthly Magazine

The widgets have a retail price of $25, and the monthly subscription cost of Widget Monthly Magazine is $10.

Provide the journal entries on September 30th

2. Nook shipped out the October issue of Widget Monthly Magazine on Oct 31st 2020, the November issue on November 30th 2020, and the December issue together with the widgets on Dec 31st 2020.

Assuming that Nook last prepared financial statements on Sept 31st 2020, provide the necessary adjusting entries on Dec 31st 2020.

Business   Accounting   
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