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Saved Help Save & Exit Su Duluth Co. collected a $6,000 cash advance from a customer on November 1, Year 1 for work to be per
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Answer #1

The correct option is Decrease liabilities and increase revenues.

Explanation: The advance income will be debited and the revenue will be credited as the adjusting entry. The advance income is a liability and the debit in liability shows the increase in liability. the credit in revenue shows the increase in the revenue. Thus, the adjusting entry will decrease the liabilities and increase the assets.

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