On October 1, Mathis Company Entered into a Six-Month Contract \begin{array}{l}\text { Cash }&3,000\ \\\quad \text { Service Revenue }&3,000\\end{array}

Multiple Choice

On October 1, Mathis Company entered into a six-month contract with Lewis Company to provide custodial services on a daily basis. The terms of the contract state that the cost will be $3,000 per month and Mathis will bill Lewis at the end of every two months. If Mathis is a calendar year company, what is the appropriate adjusting entry at December 31?

A)
\begin{array}{l}\text { Cash }&3,000\ \\\quad \text { Service Revenue }&3,000\\end{array}
B)
$\begin{array}{cc}\text { Accounts Receivable } & 3,000 \\\text { Service Revenue } & 3,000\end{array}$
C)
Service Revenue $\quad 3,000$
Accounts Receivable $\quad 3,000$
D)
$\begin{array}{lr}\text { Accounts Receivable } & 3,000 \\\text { Cash } & 3,000\end{array}$