Friday, February 19, 2010

Advance Payment Journal Entry

Many customers will pay for services in advance. The accountants jobs is to record this payment with a journal entry to help the company properly compute income in the future and understand where it is making its revenue. This will be of more concern for companies that are own an accrual basis of accounting.


Type of Journal Entry
Account titles
Debit
Credit
Advance payment from a customer for services or sales to be performed in the future.
Cash
Unearned Fees Earned
XXX

XXX

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