Homework Answers
Solution :
Answer is (b) Credit to Deferred Revenue.
Explanation : Sale of Gift Card/ Certificate is not a revenue, It is recorded as Liability as the Service/Sale Obligation has not been done.later on when they are presented to company, revenue will be recognised . Following entry is passed on sale of Gift Card/ Certificate :
| Account | Debit | Credit |
| Cash | xxx | |
| Deferred Revenue / Unearned Revenue | xxx | |
| (To record the sale of gift card/certificate) |
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