On 1 January 2020, a company received OMR 14000 cash as rent revenue for two years. Pass the adjusting entry on 31st December 2020 Select one: O a. Date Particulars Debit Credit |(OMR) (OMR) 31 Unearned 14000 Dec rent revenue 14000 Income rent revenue Income b. None of these с. Date Particulars Debit Credit (OMR) (OMR) 31 Cash 14000 Dec Unearned 14000 rent revenue Income d. Date Particulars Debit Credit |(OMR) (OMR) 31 Unearned 7000 Dec rent revenue 7000 Income rent revenue Income
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At the end of the accounting period, a financial statement is prepared by every company, then at that time while preparing the financial statement, the company determines among its total receivable amount how much portion of receivables is collected by the company during that accounting period.
Accounts Receivable
The word “account receivable” means the payment is yet to be made for the work that is already done. Generally, each and every business sells its goods and services either in cash or in credit. So, when the goods are sold on credit account receivable arise which means the company is going to get the payment from its customer to whom the goods are sold on credit. Usually, the credit period may be for a very short period of time and in some rare cases it takes a year.
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