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3 January, 07:21

On January 1, 2016, Flathound Properties received $22,800 from a tenant as rent for all of 2016. How would this receipt be recorded on Flathound Properties' books on 1/1/2016?

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  1. 3 January, 07:33
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    Journal entry: It is a recording of transactions that involves the debit and credit side. Debit side records all expenses, losses whereas the credit side involve income and the gains.

    The journal entry is shown below:

    Rent received in advance A/c Dr

    To Rent revenue

    (Being rent advance is received)

    Since there is no cash involved in the transaction, so we ignored it. Therefore, we debit the rent received in advance and credit the rent revenue
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