Final answer:
The entry to record Echo Lake Resort's deposits from customers as an adjusting entry would involve crediting a liability account and debiting a revenue account, with the specifics dependent on whether the service has been provided or not.
Step-by-step explanation:
The entry to record deposits received from customers at Echo Lake Resort during the last month of its fiscal year, with some guests completing their stays by the end of the month, is indeed an example of an adjusting entry. An adjusting entry is necessary to ensure that the resort's financial statements reflect the correct amount of revenue earned and liabilities owed at the end of the accounting period.
If customers have completed their stay, the resort has earned the revenue, and the entry would involve decreasing (crediting) a liability account (such as Customer Deposits or Unearned Revenue) and increasing (debiting) a revenue account (such as Service Revenue or Room Revenue). For deposits from customers who have not yet stayed, the liability remains as unearned revenue, since the service has not yet been provided.
In summary, the adjusting entry would depend on whether the service was rendered by the end of the period (recognized revenue) or is yet to be provided (deferred revenue).