Pages,IncReceives Subscription Payments for Annual (One Year)subscriptions to Its Magazine

question 65

Multiple Choice

Pages,Inc.receives subscription payments for annual (one year) subscriptions to its magazine.Payments are recorded as revenue when received.Amounts received but unearned at the end of each of the last three years are shown below. Pages failed to record the unearned revenues in each of the three years.The entry needed to correct the above errors is

• A) Retained Earnings ..................150,000 Subscription Revenues ..............26,000 Unearned Revenues ...............176,000
• B) Retained Earnings ..................30,000 Subscription Revenues ..............26,000 Unearned Revenues ...............56,000
• C) Subscription Revenues ..............176,000 Unearned Revenues ...............176,000
• D) Subscription Revenues ..............150,000 Retained Earnings ..................26,000 Unearned Revenues ...............176,000

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Definitions:

Shays' Rebellion

A series of protests in 1786 and 1787 by American farmers against state and local enforcement of tax collections and judgments for debt.

Paper Currency

Money in the form of banknotes issued by a government or central bank as legal tender.

New Jersey Plan

A proposal at the Constitutional Convention (1787) advocating for a single legislative house with equal representation for each state, contrasting with the Virginia Plan’s representation based on population.

William Paterson

A signatory of the U.S. Constitution, Associate Justice of the Supreme Court, and the second Governor of New Jersey.