Question

On February 1, Risa Inc. purchases a one year Amazon Prime membership for $120 Cash.

Prepare the journal entry to record the February 1 transaction.

DR: Expense, Cash, Prepaid Expense, or Accrued Expense (Amount: 120,10)

CR: Accrued Expense, Prepaid Expense, or cash (Amount: 120,10)

Answer 1

SOLUTION :
	Adjusting Entry for the service perfromed is as below,
		Prime membership is purchased for	$                         120
		Paid Cash	$                         120
		Service Taken for Nil value as on February 1	$                            -
	This is an Prepaid expenses for we get benefit in Future
	Journal Entries
	Date	Account Title and explanation	Debit	Credit
	February.01	Prepaid Expenses	$                         120
		Cash		$                      120
		(To Recordh the Prepaid Expenses)