Question

In December 2020, Quebecor Printing received magazine subscriptions for 2021 from customers, who paid $570 in cash. What would be the appropriate journal entry for this event in December 2020?

Answer 1

See explanation section

Step-by-step explanation:

December 2020 Cash Debit $570

Unearned revenue Credit $570

Since Quebecor Printing received cash, cash account is debit with the same amount of money they received. Again, as customers paid in advance, it is a liability for the company. Moreover it is an advanced revenue, so "unearned revenue" is a credit.