What Is the Adjusting Entry for That Portion of Revenue

question 9

Multiple Choice

What is the adjusting entry for that portion of revenue received in advance which has now been earned?

• A)Unearned Revenue - Debit;Cash - Credit
• B)Unearned Revenue - Debit;Service Revenue - Credit
• C)Service Revenue - Debit;Unearned Revenue - Credit
• D)Cash - Debit;Unearned Revenue - Credit

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Definitions:

Lower of Average Cost or Market

An inventory valuation method where inventory is valued at either its average cost or market value, whichever is lower.

Cost-to-retail Percentage

A ratio used in inventory valuation that compares the cost of inventory to its retail price.

Freight-in Charges

Costs associated with transporting goods from the supplier to the buyer's location.

Sales Returns

Transactions where customers return previously purchased merchandise, leading to a reduction in the seller's revenue.