Accounting for IGCSE & O level - Preparation Of Financial Statements (Section 12 - No. 15)
What is the journal entry for unearned revenue being earned?
Debit Cash, Credit Unearned Revenue
Debit Unearned Revenue, Credit Service Revenue
Debit Service Revenue, Credit Unearned Revenue
Debit Cash, Credit Service Revenue
Explanation
As the revenue is earned, the liability (unearned revenue) is reduced and the service revenue is increased.
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