on august 1 of the current year, trevor beck received $7,800 for legal services to be performed evenly…

on august 1 of the current year, trevor beck received $7,800 for legal services to be performed evenly throughout the next six months. the adjusting entry on december 31 of the current year would include a:\n\na. credit to service revenue of $6,500.\nb. credit to unearned service revenue of $6,500.\nc. debit to unearned service revenue of $1,300.\nd. debit to service revenue of $1,300.

on august 1 of the current year, trevor beck received $7,800 for legal services to be performed evenly throughout the next six months. the adjusting entry on december 31 of the current year would include a:\n\na. credit to service revenue of $6,500.\nb. credit to unearned service revenue of $6,500.\nc. debit to unearned service revenue of $1,300.\nd. debit to service revenue of $1,300.

Answer

Explanation:

Step1: Calculate monthly revenue

Total amount = $7,800, period = 6 months. Monthly revenue = $\frac{7800}{6}=1300$

Step2: Calculate revenue for August - December

Number of months from August 1 to December 31 is 5 months. Revenue earned = $1300\times5 = 6500$ Since the revenue is earned, we credit Service Revenue (unearned revenue is reversed as revenue is earned).

Answer:

A. credit to Service Revenue of $6,500.