Question

​Improvements, a home improvement​ magazine, collected $ 1 comma 920 comma 000$1,920,000 in subscription revenue on June 30. Each subscriber will receive an issue of the magazine in each of the next 12​ months, beginning with the July issue. The company uses the accrual method of accounting. What is the amount of Subscription Revenue that has been earned by the end of​ December? (Round any intermediate calculations to two decimal​ places, and your final answer to the nearest whole​ number.)

Answer 1

The amount of Subscription Revenue that has been earned by the end of​ December is $960,000

Step-by-step explanation:

The computation of the amount of the subscription revenue is shown below:

= Subscription revenue × (number of months ÷ total number of months in a year)

= $1,920,000 × (6 months ÷ 12 months)

= $960,000

The six months is calculated from the July 1 to December 31. Since we have to record the amount for the end of the December so we take the six months