On April 10, 2013, Peter Services Received $4,800 in Advance

question 61

Multiple Choice

On April 10, 2013, Peter Services received $4,800 in advance from a customer for one month's service, to be provided April 10, 2013 to May 10, 2013. What would be the journal entry to adjust the accounts at the end of April?

• A)debit Service Revenue $1,600 and credit Unearned Revenue $1,600
• B)debit Unearned Revenue $3,200 and credit Service Revenue $3,200
• C)debit Unearned Revenue $4,800 and credit Service Revenue $4,800
• D)debit Service Revenue $3,200 and credit Accounts Receivable $3,200

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Definitions:

Minimum Imposed Price

A price floor set by the government, preventing prices from falling below a certain level.

Deadweight Loss

An economic inefficiency that occurs when market equilibrium is not achieved or is distorted, typically due to a price floor, ceiling, or tax.

Price Control

A government-imposed limit on the price charged for a product.

Price Ceiling

A legal maximum price that can be charged for a good or service.