Question

A company bills customers for services rendered on account. Which of the following is part of recording this transaction?

a. Decrese service revenue
b. Decrease cash
c. Increase account receivable
d. Increase Unearned revenue

Answer 1

Answer:

c. Increase account receivable

Explanation:

The journal entry for the record this transaction is  

Accounts receivable A/c Dr XXXXX

     To Service revenue A/c  XXXXX

(Being the service is rendered on the account is recorded)

This transaction increases the account receivable as well as the service revenue account so the respective account is debited and credited.