Question

OnJuly 1, 2022, Blossom Co pays $12,000 to Nash's insurance Co. for a 4 year insurance contract Both companies have fiscal years unding December 31 Journalize and post the entry on July 1 and the annual adjusting entry on December 31 for Nash's Incurance Ca. Nash's uses the accounts Uneamed Service Revenue and Service Revenue. (List all debit entries before credit entries. Credit account titles ore automatically indented when the amount is entered, Do not indent manually. Record journal entries in the order presented in the problem.)

Answer 1

On July 1, 2022, Blossom Co pays $12,000 to Nash's insurance Co. for a 4-year insurance contract. On July 1, journalize the entry as Debit Accounts Receivable and Credit Unearned Service Revenue. On December 31, make an adjusting entry to recognize the earned revenue.

Step-by-step explanation:

On July 1, 2022, Blossom Co pays $12,000 to Nash's insurance Co. for a 4-year insurance contract. Both companies have fiscal years ending December 31.

1. Journal entry on July 1:
   Unearned Service Revenue
2. Annual adjusting entry on December 31:
   Unearned Service Revenue...