On November 1, Bryant Company received $36,600 for six months of rent in advance. On November 1, Bryant Company credited Rent Revenue, which is an alternate way of recording the initial receipt of cash. Required: Journalize the adjusting entry on November 31.

Entry for Bryant company mistake:

Debit Credit

Rent Revenue $36,600

Advance Rent $36,600

Entry for recording rent revenue for the month of November:

Debit Credit

Advance Rent $6,100

(36,600/6)

Rent Revenue $6,100

Explanation:

The journal entry which should have been recorded by the Bryant Company on receipt of rent on November 1 should have been following:

Debit Credit

Cash $36,600

Advance Rent $36,600

But the Bryant company has recorded the following entry on November 1 instead of above mentioned correct entry:

Debit Credit

Cash $36,600

Rent Revenue $36,600

On November 31, the following two journal entries shall be recorded in the accounts of the Bryant Company in order to correct the earlier wrong entry made by the Bryant company and to record the rent income entry for the month of the November.

Entry for Bryant company mistake:

Debit Credit

Rent Revenue $36,600

Advance Rent $36,600

Entry for recording rent revenue for the month of November:

Debit Credit

Advance Rent $6,100

(36,600/6)

Rent Revenue $6,100