Business, 03.03.2020 17:27 DerrtDiggler7826

The Krug Company collected $9,000 rent in advance on November 1, debiting Cash and crediting Unearned Rent Revenue. The tenant was paying 12 months' rent in advance and occupancy began November 1.
Unearned rent revenue:
Step 1: Determine what the current account balance equals.
Step 2: Determine what the current account balance should equal.
Step 3. Record the December 31 adjusting entry to get from step 1 to step 2.

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Answer from: daonewest09

The current account balance is $9000 in cash and $9000 in unearned rent.

The current account balances should be cash $9000, unearned rent $7500 and rent revenue $1500.

Adjusting entries required

Debit Unearned rent $1500

Credit Rent revenue $1500

Explanation:

When cash is collected in advance, an asset is created in form of cash and a liability in form of deferred/unearned revenue. As revenue is earned, a debit is posted to unearned revenue and a credit to revenue.

The accounting equation is

Assets = liabilities + equity

Hence when cash was collected in advance

Debit Cash $9,000

Credit Unearned rent $9,000

When revenue is earned between November 1 and December 31, amount earned

= 2/12 × $9000

= $1500

Balance in Unearned rent account = $9000 - $1500

= $7500

The current account balance is $9000 in cash and $9000 in unearned rent.

The current account balances should be cash $9000, unearned rent $7500 and rent revenue $1500.

Adjusting entries required

Debit Unearned rent $1500

Credit Rent revenue $1500

Answer from: Quest

our agriculture industry and our business industry

Answer from: Quest

1 all nations face the problem of scarcity because there are limited resources and unlimited wants. nations do not have enough factors of production to produce everything that their population wants. entrepreneurial resources initiate businesses to make new goods and services; labor resources produce goods and services.

2 there are four factors of production: natural resources, labor resources, capital resources, and entrepreneurial resources. natural resources are raw materials from nature that are used to produce goods. trees, water, and grains are natural resources. some natural resources, such as wheat and cattle, are renewable

3 wants

things that you do not need to have in order to survive, but would like to have

needs

things that you must have in order to survive

goods

physical products

services

tasks that a business perform for customers

resources

items that people can use to make or obtain what they need or want

determine

to settle or decide by choice of alternatives or possiblities

4 i really dont know

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The Krug Company collected $9,000 rent in advance on November 1, debiting Cash and crediting Unearne...

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