Problem:
Hudson Corp. has extra space in its warehouse and agrees to rent it out to Stillwater Company at the rate of $2,000 per month. The space was made available to Stillwater beginning on September 1, 2010. Under the terms of the agreement, Stillwater pays the month's rent on the fifth day after the end of the month. Assume that Hudson prepares adjustments at the end of each month.
Required:
Question 1: How much revenue should Hudson record in September? How much revenue should Hudson record in October?
Question 2: Identify and analyze the transactions, including any adjustments, on Hudson's books during the month of October.
Note: Please provide reasons to support your answer.