last week of 2020, Grandma’s House Inc. received a $96,000 prepayment for 2021 rent of a building from one of its tenants, Red-Riding-Hood. Grandma’s House recorded the receipt as rent revenue. The error was discovered midway throu
last week of 2020, Grandma’s House Inc. received a $96,000 prepayment for 2021 rent of a building from one of its tenants, Red-Riding-Hood. Grandma’s House recorded the receipt as rent revenue. The error was discovered midway throu
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
During the last week of 2020, Grandma’s House Inc. received a $96,000 prepayment for 2021 rent of a building from one of its tenants, Red-Riding-Hood. Grandma’s House recorded the receipt as rent revenue. The error was discovered midway through 2021. What
Group of answer choices
dr. Rent Expense $48,000; cr. Revenue $48,000.
dr. Deferred Revenue $96,000; cr. Revenue $96,000.
dr.
None of the options listed.
dr. Retained earnings $96,000; cr. Deferred revenue $48,000; cr. Revenue $48,000.
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