Mohling Company Typically Sells Subscriptions on an Annual Basis, and Publishes

question 104

Multiple Choice

Mohling Company typically sells subscriptions on an annual basis, and publishes eight times a year. The magazine sells 45,000 subscriptions in January at $10 each. What entry is made in January to record the sale of the subscriptions?

• A) Subscriptions Receivable 450,000 Subscription Revenue 450,000
• B) Cash 450,000 Unearned Subscription Revenue 450,000
• C) Subscriptions Receivable 56,250 Unearned Subscription Revenue 56,250
• D) Prepaid Subscriptions 450,000 Cash 450,000

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Definitions:

Security Analysis

The evaluation of financial instruments (such as stocks, bonds) to determine their value and potential for return on investment.

Index Fund

A collective investment scheme designed to follow certain preset rules so that the fund can track a specified basket of underlying investments.

Market Representation

The degree to which a statistical sample or a financial index accurately reflects the broader market or sector it aims to represent.

Portfolio

A collection of investments held by an individual or institution, including stocks, bonds, commodities, and more, to diversify risk.