Asked by
Antonio Ferreira
on Oct 16, 2024Verified
GreenLawn Co.provides landscaping services to clients.On May 1,a customer paid GreenLawn $60,000 for 6-months services in advance.GreenLawn's general journal entry to record this transaction will include a:
A) Debit to Unearned Revenue for $60,000.
B) Credit to Accounts Receivable for $60,000.
C) Credit to Cash for $60,000.
D) Credit to Unearned Revenue for $60,000.
E) Debit to Accounts Receivable for $60,000.
Unearned Revenue
Prepayment from customers for goods or services which have not yet been delivered or performed, representing a liability until the obligation is fulfilled.
General Journal
The general journal is an accounting ledger in which all types of transactions are initially recorded, formatted by date, before being transferred to specific accounts in the general ledger.
Landscaping Services
Professional services that encompass the planning, designing, and maintenance of outdoor and garden spaces.
- Utilize debit and credit principles to accurately document transactions.
- Comprehend how prepaid and unearned items influence financial statements.
Verified Answer
GS
Learning Objectives
- Utilize debit and credit principles to accurately document transactions.
- Comprehend how prepaid and unearned items influence financial statements.