Question

Document Layout References Mailings Review View AS MADAM ABCD ABCD AaBb CODE Heading * 1) ITV Company received $36,000 cash on March 1, 2019, from XYZ Company as an advance payment for services ITV promised to perform for XYZ over the next three years on a continuous basis. Assume that ITV Company's year-end is December 31. On its 2020 income statement, ITV would report revenue of 2) On October 1, Year 1, Senegal Company paid $1,200 in advance for rent of office space for one year and recorded a journal entry debiting Prepaid Rent and crediting Cash for $1,200. On December 31, Year 1, the required adjusting entry was recorded. What are the adjusted account balances at December 31, Year 1? 3) on January 1, 2020 the Supplies account had a balance of $1,200. During the year the company purchased $3,400 of Supplies for cash On December 31, 2020 Saul determined that there were $1,400 of supplies on hand. What entry should be made at December 31, 2020 to correctly record Supplies Expense incurred during the year. 4) On September 1, 2020, Saul collected $9,000 in revenue in advance from a client for advisory services for a one-year period beginning on September 1, 2020 What entry should be made at December 31, 2020 to correctly record the Service Revenue for the year 2020 5) ITV Company received $36,000 cash on March 1, 2019, from XYZ Company as an advance payment for services ITV promised to perform for XYZ over the next three years on a continuous basis. Assume that ITV Company's year-end is December 31 On its December 31, 2020 balance sheet ITV would report liabilities of 6) On October 1, 2020, the company paid $7,200 to lease office space for one year beginning immediately. On October 1, 2020, the following entry was made. DR Prepaid Rent $7,200 CR Cash $7,200 What entry should be made at December 31, 2020 to correctly record the Rent Expense incurred in the year 2020 United States) Focus MacBook Air

Answer 1

1	ITV would report revenue of	$             12,000
	($36000/36Month*12Months)

12 months's revenue should be recognized on its 2020 income statement

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2	Advance rent paid on October-1	$               1,200
	Rent expensed for year 1 =	$                   300	(1200*3/12)
	(for Oct.,Nov.,Dec.)
	Adjusted Account balance will be	$                   900	(1200-300)
	Entry:	Debit	Credit
	Rent Expense	$                   300
	Prepaid Rent		$                     300

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3	Entry:	Debit	Credit
	Supplies Expense	$               3,200
	Supplies		$                 3,200
	Opening Supplies	$               1,200
	Purchased during the year	$               3,400
	Less:Supplies on hand at the end	$             -1,400
	Supplies Expense	$               3,200

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4	Entry:	Debit	Credit
	Service Revenue	$               3,000
	Unearned Service Revenue		$                 3,000
	($9000/12*4)

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5	Unearned Service Revenue Received on March 1,2019	$             36,000
	Less:
	Revenue recognized for the year 2019 (for 10 months)	$             10,000	(36000/36*10)
	Revenue recognized for the year 2020	$             12,000	(36000/36*12)
	Balance liability	$             14,000
	***Assumed that service started from March 1, 2019

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6	Entry:	Debit	Credit
	Rent Expense	$               1,800
	Prepaid Rent		$                 1,800
	Rent expensed for 2020 =	$               1,800	(7200*3/12)

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