Question

The balance in the unearned fees account, before adjustment at the end of the year, is $12,960. Required: Journalize the adjusting entry required if the amount of unearned fees at the end of the year is $6,960. Refer to the Chart of Accounts for exact wording of account titles.

Answer 1

Answer:

The journal entry is shown below:

Explanation:

The journal entry for the following is as follows:

On December 31

Unearned Fees A/c........................Dr  $6,000

     Fees Earned A/c..............................Cr  $6,000

Being the adjusting entry is posted for the unearned fees.

The account of unearned fees is debited against the account of fees earned with the amount of $6,000.

Working Note:

Amount = Before adjustment amount - Unearned fees at the year end

where

Before adjustment amount is $12,960

Unearned fees at the year end is $6,960

Putting the values above:

Amount = $12,960 - $6,960

= $6,000