Question

The following transactions for March have been journalized and posted to the proper accounts.

Mar. 1 The business received $10,000 cash and issued common stock to stockholders.
Mar. 2 Paid the first​ month's rent of $700.
Mar. 3 Purchased equipment by paying $2,000 cash and executing a note payable for $6,000.
Mar. 4 Purchased office supplies for $750 cash.
Mar. 5 Billed a client for $12,000 of design services completed.
Mar. 6 Received $8,000 on account for the services previously recorded.

What is the ending balance in the Service Revenue​ account?

A. $18,000
B. $10,000
C. $12,000
D. $8,000

Answer 1

The ending balance in the Service Revenue account would be $20,000.

Step-by-step explanation:

The ending balance in the Service Revenue account can be calculated by adding up the revenue generated from the transactions specified. In this case, the revenue recorded from billing a client for design services completed is $12,000. Additionally, the revenue received on account for previously recorded services is $8,000. Therefore, the ending balance in the Service Revenue account would be $12,000 (from billing a client) + $8,000 (from receiving payment on account) = $20,000.