Question

A company rented a premise for a year and collected an advance rent of $24,000 on January 1,2018.Prepare the entry to record the rent received? ​

Answer 1

Answer:

On June 1, 2019, an advance rent payment of $8,400, representing a four-month prepayment for the months of June, July, August, and September, was received in cash from the company’s tenant.

The journal entry to record the effects of the four months of rent collected in advance on June 1, 2019 is:

a. Dr.Cash 8,400 /Cr.Rent Revenue 8,400

b. Dr.Cash 8,400/ Cr.Unearned Rent Revenue 8,400

c. Dr.Unearned Rent Revenue 6,300/ Cr.Rent Revenue 6,300

d. Dr.Unearned Rent Revenue 2,100 /Cr.Rent Revenue 2,100