FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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P9-7 Determining Financial Statement Effects of Deferred Revenues LO9-1
A. Deferred revenues-customer deposits
Eastern Brewing Company (EBC) distributes its products in an aluminum keg. Customers are charged a deposit of $22 per keg, and
deposits received from customers are recorded in the keg deposits account.
Required:
1. This part of the question is not part of your Connect assignment.
2. A production specialist who works for EBC estimates that 85 kegs for which deposits were received during the year will never be
returned. How would the deposits related to these 85 kegs be reflected in the company's financial statements? (If no entry is required
for a transaction/event, select "No journal entry required" In the first account fleld.)
View transaction list
Journal entry worksheet
<
1
Record deposit revenue.
Note: Enter debits before credits.
Transaction
A
Record entry
General Journal
Clear entry
Debit
Credit
View general journal
expand button
Transcribed Image Text:P9-7 Determining Financial Statement Effects of Deferred Revenues LO9-1 A. Deferred revenues-customer deposits Eastern Brewing Company (EBC) distributes its products in an aluminum keg. Customers are charged a deposit of $22 per keg, and deposits received from customers are recorded in the keg deposits account. Required: 1. This part of the question is not part of your Connect assignment. 2. A production specialist who works for EBC estimates that 85 kegs for which deposits were received during the year will never be returned. How would the deposits related to these 85 kegs be reflected in the company's financial statements? (If no entry is required for a transaction/event, select "No journal entry required" In the first account fleld.) View transaction list Journal entry worksheet < 1 Record deposit revenue. Note: Enter debits before credits. Transaction A Record entry General Journal Clear entry Debit Credit View general journal
B. Deferred revenues-rent
On September 1, year 1, Noreen Ltd. collected $88,200 in cash from its tenant as an advance rent payment on its store location. The
six-month lease period ends on February 28, year 2, at which time the lease contract may be renewed. Noreen's fiscal year ends on
December 31.
Required:
1. Prepare journal entries to record the collection of rent on September 1, year 1, and the related adjustment for the amount of rent
earned during year 1. (If no entry is required for a transaction/event, select "No journal entry required" In the first account fleld.)
View transaction list
Journal entry worksheet
1 2
Record rent received in advance.
Note: Enter debits before credits.
Date
Sept 01, Year 1
Record entry
General Journal
Clear entry
Debit
Credit
View general journal
expand button
Transcribed Image Text:B. Deferred revenues-rent On September 1, year 1, Noreen Ltd. collected $88,200 in cash from its tenant as an advance rent payment on its store location. The six-month lease period ends on February 28, year 2, at which time the lease contract may be renewed. Noreen's fiscal year ends on December 31. Required: 1. Prepare journal entries to record the collection of rent on September 1, year 1, and the related adjustment for the amount of rent earned during year 1. (If no entry is required for a transaction/event, select "No journal entry required" In the first account fleld.) View transaction list Journal entry worksheet 1 2 Record rent received in advance. Note: Enter debits before credits. Date Sept 01, Year 1 Record entry General Journal Clear entry Debit Credit View general journal
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