Baden Realty Company received a check forP18,000 on July 1 which represents a 6month advance payment of rent on abuilding it rents to a client. Unearned Rentwas credited for the full P18,000. Financialstatements will be prepared on July 31.Baden Realty should make the followingadjusting entry on July 31: *Debit Unearned Rent, P3,000; Credit RentalRevenue, P3,000.Debit Rental Revenue, P3,000; CreditUnearned Rent, P3,000.Debit Unearned Rent, P18,000; Credit RentalRevenue, P18,000.Debit Cash, P18,000; Credit Rental Revenue,P18,000.

Revenue earned on july 31 = total amount received / no. of months = 18000/6 months = P3,000

Answered: Baden Realty Company received a check…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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