Examlex

Solved

Daily Printings Sold Annual Subscriptions to Their Magazine for $30,000

question 192

Essay

Daily Printings sold annual subscriptions to their magazine for $30,000 in December, 2013. The magazine is published monthly. The new subscribers received their first magazine in January, 2014.
1. What adjusting entry should be made in January if the subscriptions were originally recorded as a liability?
2. What amount will be reported on the January 2014 statement of financial position for Unearned Subscription Revenue?


Definitions:

Executed Contract

A contract that has been fully completed, meaning all terms and conditions have been met by the parties involved.

Contractual Obligations

Legal commitments derived from agreements that parties are required to fulfill.

Formal Commitment

Refers to a binding agreement or pledge to engage in or refrain from a specified action.

Implied Contract

A contract that arises not from words of agreement but from the conduct of the parties.

Related Questions