dexter, inc., collects cash from customers in advance and from other customers after the sale. read the…
dexter, inc., collects cash from customers in advance and from other customers after the sale. read the requirement. a. journalize dexter earning service revenue of $22,000 on account and then collecting $9,000 on account. (record debits first, then credits. exclude explanations from any journal entries.) start by recording dexter earning $22,000 of service revenue on account. date accounts debit credit 2024 accounts receivable 22,000 service revenue 22,000 next, record the entry to show dexter collecting $9,000 cash for a portion of the revenue previously earned on account. date accounts debit credit 2024 cash 9,000 accounts receivable 9,000 b. journalize dexter receiving $4,500 in advance and then earning $3,000 as service revenue. start by recording dexters cash collections in advance of services being performed. date accounts debit credit 2024
Answer
Explanation:
Step1: Record cash collection in advance
When Dexter receives cash in advance, cash increases (debit) and a liability (Unearned Service Revenue) is created (credit).
| Date | Accounts | Debit | Credit |
|---|---|---|---|
| 2024 | Cash | 4,500 | |
| Unearned Service Revenue | 4,500 |
Step2: Record service revenue earned
As Dexter earns $3,000 of the previously unearned revenue, the liability (Unearned Service Revenue) decreases (debit) and Service Revenue increases (credit).
| Date | Accounts | Debit | Credit |
|---|---|---|---|
| 2024 | Unearned Service Revenue | 3,000 | |
| Service Revenue | 3,000 |
Answer:
| Date | Accounts | Debit | Credit |
|---|---|---|---|
| 2024 | Cash | 4,500 | |
| Unearned Service Revenue | 4,500 | ||
| 2024 | Unearned Service Revenue | 3,000 | |
| Service Revenue | 3,000 |