Brief Exercise 3-6 Your answer is partially correct. Try again. On July 1, 2017,

Question

Brief Exercise 3-6 Your answer is partially correct. Try again. On July 1, 2017, Dobbs Co. pays $21,900 to Kalter Insurance Co. for a 3-year insurance contract. Both companies have fiscal years ending December 31 ournalize and post the entry on July 1 and the adjusting entry on December 31 for Kalter Insurance Co. Kalter uses the accounts Unearned Service Revenue and Service Revenue Account Titles Debit Credit July 1 Prepaid Insurance 21900 Cash 21900 oi Dec. 31 Insurance Expense 3650 Prepaid Insurance 3650 Unearned Service Revenue 219000 12/31 3650 12/31 Bal. 18250 Service Revenue 12/31 365000 12/31 Bal. v 3650

Explanation / Answer

Journal entry:

T Account :

Date account titles Debit credit July 1 Cash 21900 Unearned service revenue 21900 Dec 31 Unearned Service revenue (21900*6/36) 3650 Service revenue 3650

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