Question

A company receives $10,000 in cash for services yet to be performed. Using the accrual method, what's the correct entry to record the transaction? (A) Debit cash $10,000, credit accounts receivable $10,000 (B) Debit cash $10,000, credit sales revenue$1 0,000 (C) Debit sales revenue $10,000, credit cash $10,000 (D) Debit cash $10,000, credit unearned revenue $10,000 (E) Debit cash $10,000, credit accounts payable $10,000

Answer 1

Answer:

credit accounts receivable $10,000 (B)

Answer 2

The correct entry to record the transaction is (D) Debit cash $10,000, credit unearned revenue $10,000.

What is the accrual method of recording transactions?

With the accrual method, transactions, that is revenue or expenses, are recorded when they occur not when payment is received or made.

The accrual method follows the matching principle.  The matching principle requires that expenses are matched to the revenue that they generate.

Thus, the correct entry to record the transaction, where a company receives $10,000 in cash for services yet to be performed, is (D) Debit cash $10,000, credit unearned revenue $10,000.

Learn more about the accrual method at https://brainly.com/question/17233434

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