on december 1, 2025, carries day care receives $3,900 in advance for an agreement to care for susans…

on december 1, 2025, carries day care receives $3,900 in advance for an agreement to care for susans children for the months of december, january, and february. carries day care will make an adjusting entry on december 31, 2025 to:\n\na. credit revenue for $2,600.\nb. credit revenue for $3,900.\nc. credit prepaid revenue for $2,600.\nd. debit unearned revenue for $1,300.

on december 1, 2025, carries day care receives $3,900 in advance for an agreement to care for susans children for the months of december, january, and february. carries day care will make an adjusting entry on december 31, 2025 to:\n\na. credit revenue for $2,600.\nb. credit revenue for $3,900.\nc. credit prepaid revenue for $2,600.\nd. debit unearned revenue for $1,300.

Answer

Explanation:

Step1: Calculate monthly revenue

The total amount received in advance is $3900 for 3 months. So the monthly revenue is $\frac{3900}{3}=1300$.

Step2: Analyze the adjusting entry on December 31

On December 31, one - month's service (December) has been provided. Unearned Revenue (a liability account) is debited when revenue is earned. The amount of revenue earned in December is $1300.

Answer:

D. debit Unearned Revenue for $1,300.