Tunica Company's Fiscal Year Ends on September 30 of the Current

Essay

Tunica Company's fiscal year ends on September 30 of the current year. Tunica frequently has accrued revenues at the end of its fiscal year that are recorded for proper financial statement presentation. The company has determined through an evaluation of invoices and services rendered that $32,000 of services has been provided as of September 30, but not yet billed. The total contract to be billed for services when completed will be $60,000. Record the following entries:
(a) Accrual of the revenues on September 30.
(b) Receipt of payment from customers on October 9 for the services rendered, assuming that Tunica does not prepare reversing entries.
(c) Assuming that Tunica prepares reversing entries, reverse the adjusting entry made on September 30.
(d) Assuming that Tunica prepares reversing entries, receipt of the payment for the total contract amount on October 9.