Action Real Estate Received a Check for $18,000 on July

question 61

Multiple Choice

Action Real Estate received a check for $18,000 on July 1 which represents a 6 month advance payment of rent on a building it rents to a client. Unearned Rent was credited for the full $18,000. Financial statements will be prepared on July 31. Action Real Estate should make the following adjusting entry on July 31:

• A) Debit Unearned Rent, $3,000; Credit Rental Revenue, $3,000.
• B) Debit Rental Revenue, $3,000; Credit Unearned Rent, $3,000.
• C) Debit Unearned Rent, $18,000; Credit Rental Revenue, $18,000.
• D) Debit Cash, $18,000; Credit Rental Revenue, $18,000.

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