Question

State whether each situation is a prepaid expense (PE), unearned revenue (UR), accrued revenue (AR) or an accrued expense (AE).

Answer 1

Answer:

1.  Accrued Revenue of $ 245

2. Accrued expenses of $ 300

3. Unearned Revenue of $ 600

4. Prepaid expenses of $ 200

5. Accrued expenses of $ 1,200

Explanation:

1. The interest on savings bond is a revenue which has been earned but not received and is thus an accrued revenue.

2. The property expenses are an accrued expenses since these have been incurred  but not paid.

3. The unearned portion of the legal fees received is an unearned revenue, since services have not been provided.

4. The unexpired portion of insurance is a prepaid expense

5. Salaried due nut not paid is an accrued expenses since services ahve been received.