How would you work out the following problem?
Evans Ltd. publishes a monthly newsletter for retail marketing managers and requires its subscribers to pay $90 in advance for a one-year subscription. During the month of August 2016, Evans Ltd. sold 400 one-year subscriptions and received payments in advance from all new subscribers. Only 240 of the new subscribers paid their fees in time to receive the August newsletter; the other subscriptions began with the September newsletter.
A) Write journal entries to record the effects of the following items:
1) Subscription fees received in advance during August 2016.
2) Subscription revenue earned during August 2016.
B) Calculate the amount of subscription revenue earned by Evans Ltd. during the year ended December 31, 2016, for these 400 subscriptions.