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M3-16. Assessing Financial Statement Effects of Transactions and Adjustments Schrand Services offers janitorial...

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Accounting

M3-16. Assessing Financial Statement Effects of Transactions and Adjustments
Schrand Services offers janitorial services on both a contract basis and an hourly basis. On January 1, Schrand collected $26,100 cash in advance on a six-month contract for work to be performed evenly during the next six months.
a. Prepare the entry on January 1 to reflect the receipt of $26,100 cash for contract work; use the financial statement effects template.
b. Adjust the appropriate accounts on January 31 for the contract work done during January; use the financial statement effects template.
c. At January 31, a total of 30 hours of hourly rate janitor work was performed but unbilled. The billing rate is $19 per hour. Prepare the accounting adjustment needed on January 31 using the financial statement effects template. (The firm uses the fees receivable account to reflect revenue earned but not yet billed.)
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