Question

On July 1, 2022, Sandhill Co. pays $23,000 to Blossom Company for a 1-year insurance contract. Both companies have fiscal years ending December 31. Journalize the entry on July 1 and the adjusting entry on December 31 for Blossom Company. Blossom uses the accounts Unearned Service Revenue and Service Revenue. (Record journal entries in the order presented in the problem. If no entry is required, select "No Entry" for the account titles and enter for the amounts. Credit account titles are automatically indented when the amount is entered. Do not indent manually.) Date Account Titles and Explanation Debit Credit e Textbook and Media List of Accounts

Answer 1

Solution:

Journal Entries
Date	Particulars	Debit	Credit
01-Jul	Cash Dr	$23,000
	To Unearned Service revenue		$23,000
	(To record cash received in advance for services)
31-Dec	Unearned Service revenue Dr ($23000*6/12)	$11,500
	To Service Revenue		$11,500
	(To record adjusting entry)

Unearned service Revenue
31-Dec	$11,500	01-Jul	$23,000
		End. Bal.	$11,500
Service Revenue
		31-Dec	$11,500