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LG5-2.
 1. 
Calculate the Amount of the Adjustment
  Make the Journal Entry
 Unearned revenue per month:
 $1,750/5 mo. = $350/mo.
  
 Amount earned:
 $350 × 3 mo. = $1,050
(April, May, and June = 3 months in the current
accounting period until June 30, the date of the trial
balance)
    June
    30 Unearned Revenue     1,050
 
Rent Revenue           1,050
   
A
 =   L ↓      +   OE ↑
  Unearned
Revenue
–1,050 		Rent
Revenue
+1,050
     
     

Determine the New Balances of the Accounts Affected
 
Unearned Revenue
    1,750
    1,050                 
    
  
 
Rent Revenue
    –0–
    1,050
   
  
 2.
Calculate the Amount of the Adjustment
  Make the Journal Entry
 
  
  
 Amount earned:
 $4,040 × .75 = $3,030
 
  Unearned Revenue     3,030
 
Sales Revenue           3,030
   
        A  
 =   L ↓       +   OE ↑
  Unearned
Revenue
–3,030 		Rent
Revenue
+3,030
 
Determine the New Balances of the Accounts Affected
 
Unearned Revenue
    4,040
    3,030                 
    
  
 
Sales Revenue
     –0–
    3,030
   
Learning Goal 5, continued
SOLUTIONS
   
Learning Goal 5: Prepare Adjusting Entries for Unearned Revenues
S3
 
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