The Unearned Rent Account Has a $6,000 Credit Balance in the Unadjusted

question 201

Multiple Choice

The Unearned Rent account has a $6,000 credit balance in the unadjusted trial balance. There is a $1,000 debit adjustment to Unearned Rent. The adjusted trial balance will show Unearned Rent as a:

• A) $7,000 debit balance.
• B) $7,000 credit balance.
• C) $5,000 debit balance.
• D) $5,000 credit balance.

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Definitions:

Annual Fixed Costs

Costs that do not vary with the level of production or sales over the year, such as rent, salaries, and insurance.

Financial Advantage

Any benefit or gain, in financial terms, that improves the economic situation of an entity or individual.

Unit Product Cost

The total cost incurred to produce a single unit of a product, including materials, labor, and overhead.

Fixed Production Costs

Costs that do not change with the level of production, such as rent, salaries, and insurance.