The Following Account Balances Are Taken from the December 31,2018,financial

Multiple Choice

The following account balances are taken from the December 31,2018,financial statements of ABZ Advertising Company.The company uses accrual basis accounting. $\begin{array}{lr}\text { Advertising Revenue } & 46,482 \\\text { Cash } & 41,516 \\\text { Accounts Receivable } & 7,296 \\\text { Interest Expense } & 2,299 \\\text { Accounts Payable } & 5,000 \\\text { Operating Expenses } & 37,460 \\\text { Deferred Revenue } & 1,178 \\\text { Equipment } & 18,048 \\\text { Income Tax Expense } & 2,326\end{array}$ The following activities occurred in 2019:
1.Performed advertising services on account,$55,000.
2.Received cash payments on account,$10,400.
3.Received deposits from customers for advertising services to be performed in 2020,$2,500.
4.Made payments to suppliers on account,$5,000.
5.Incurred $45,000 of operating expenses;$39,000 was paid in cash and $6,000 was on account and unpaid as of the end of the year.
Which of the following is the journal entry that will be used to record activity #3?

A) Debit Cash and credit Deferred Revenue for $2,500.
B) Debit Deferred Revenue and credit Advertising Revenue for $2,500.
C) Debit Cash and credit Accounts Receivable for $2,500.
D) Debit Deferred Revenue and credit Receivable for $2,500.