Question

Write the December 31st Adjusting journal entry if there is one. Indicate with (adj.) the adjusting entry and put the date of the adjusting entry if there is one. 2. A cash advance from a customer of $1,000 for ten months of car washes for the city's motor pool at a monthly rate of $100 was received by the business on July 1st.

Answer 1

Total months remained in accounting year					6
Total months of service					10
Service that will be rcognised for 6 months ending in accounting year as on december 31
=	$                    100	x 6
=	$                    600
	Adjusting Entry:
		Date	Account titles and explanations	Debit	Credit
		December 31	Unearned Service Revenue	$        600
			Service Revenue		$        600
			(To record adjustments of unearned service revenue)