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The Cornwall Retreat and Spa is an exclusive resort on the Cornish coast. The entity...

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The Cornwall Retreat and Spa is an exclusive resort on the Cornish coast. The entity received cash totalling 60 000 from clients between 1 January 20X6 and 30 June 20X6, as advance payments for accommodation over the summer. The financial year end of the entity is 31 July and guests with bookings totalling 20 000 had taken up their accommodation between 1 July 20X6 and 31 July 20X6. Which of the following sets of entries correctly records the above transactions? Transaction when accommodation guests take up Cr Transaction on receipt of the cash Dr Cr Cash (A) 60 000 Accommodation income (1) 60 000 Dr 60 000 a. Accommodation income Deferred income (L) 60 000 b. 60 000 20 000 Cash (A) Deferred income (L). 60 000 Deferred income (L) Accommodation income (i) 20 000 C. 60 000 20 000 Accounts receivable (A) Deferred income (L) Deferred income (L) Accommodation income (1) 60 000 20 000 d. 60 000 20 000 Deferred income (L) Accommodation income (1) Cash (A) Deferred income (L) 60 000 20 000 e. 60 000 20 000 Cash (A) Accommodation income (1) Deferred income Accommodation income (1) 60 000 20 000

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