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20 January, 19:19

18. A company is in its first month of operations. On January 15, the company receives $600 from customers who will receive 10 voice lessons ($60 per lesson). As of January 31, the company has provided 8 voice lessons. What adjusting entry would be made at the end of January? Post the adjusting entry for the scenario provided. Record the revenue for 8 voice lessons that the company has provided. The company would receive $600 from customers for 10 voice lessons ($60 per lesson).

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  1. 20 January, 19:31
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    The adjusting entry at the end of January:

    Debit Unearned revenue: $480

    Credit Revenue: $480

    Explanation:

    When recceived $600 on January 15 from customer, the company must record:

    Debit Cash: $600

    Credit Unearned revenue: $600

    because all lessons are not provided by the company, the company can't recording revenue.

    On January 31, the company provided 8 lessons, so the company must recording revenue for these lesson (8x$60=$480) by adjusting entry.
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