On December 1, 2016, an advance rent payment of $13,800, representing a three-mo

Question

On December 1, 2016, an advance rent payment of $13,800, representing a three-month prepayment for the months of December, January, and February, was received in cash from the company's tenant. Required: Complete the below table. (Use amounts withfor increases and amounts with- for decreases.) Use the horizontal model to record the effects of the following items: The three months of rent collected in advance on December 1, 2016. Balance Sheet Income Statement Liabilities Stockholders' Equity Net income Assets Revenues Cash 13,800 13,800+ 13.800-Unearned rent revenue b. The adjustment that will be made at the end of each month to show the amount of rent "earned during the month. Balance Sheet Income Statement Assets Liabilities + Stockholders' Equity- Net income Revenues Unearned rent revenue (4,600) Rent revenue 4,600

Explanation / Answer

Prepare horizontal model to record the effects of the following items :

a)The three months of rent collected in advance on december 1,2016 Balance sheet Income statement Assets = Liabilities + Stockholder's equity Net income = Revenue - Expenses Cash 13800 Unearned rent revenue 13800

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