Question

Exercise 4-7 (Part Level Submission) July 1, 2017, Crane Com pa ny pays $ 12,000 to Wil dhorse Co. for a 1-year insurance contract. Both com pan ies have fiscal years ending December 31. 9)▲Post the entry on July 1 and the adjustng entry on December 31 for Willdhorse Co., (Post entries in the order of journal antries presented In the previous part Uneamed Service Rvenue

CALCULATOR PRINTER VERLETON Brief Exercise 4-7 (Part Level Submission) On July 1, 2017, Crane Company pays $12,000 to Wildhorse Co. for a 1-year Insurance contract. Both companies have fiscal years ending December 31 (b) Post the entry on July 1 and the adjusting entry on December 31 for Wildhorse Co. (Post entries in the order of fournal entries presented in the previous part.) Uneared Service Revenue Service Revenue

Answer 1

Solution :

(a)

Date	Account Title and Explanation	Debit	Credit
July 01	Cash	$ 12,000
	Unearned Revenue		$ 12,000
Dec 31	Unearned Service Revenue ($ 12,000 / 12 * 6)	$ 6,000
	Service Revenue		$ 6,000

(b)

Unearned Service Revenue :

Dec 31	$ 6,000	July 01	$ 12,000
		Dec 31	$ 6,000

Service Revenue :

Dec. 31

$ 6,000

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