Unearned Revenue: Adjusting Entry
Response to the following :
Refer to problem.
(1) Make the adjusting entry necessary on the company's books on December 31 with respect to this security contract and
(2) compute the ending balance in the unearned security revenue account; assume that the balance as of the beginning of the year was $0
Problem:
Unearned Revenue: Original Entry
The company provides security services to its clients. On April 1, the company received $270,000 cash for a three-year security contract. The contract went into effect on April 1. Make the journal entry necessary on the company's books to record the receipt of the payment for the contract on April 1.