ADJUSTING ENTRY FOR UNEARNED REVENUE INITIALLY RECORDED AS A REVENUE 1 1. Debit the revenue account. 2 2. Credit the liability account. Lesson 10-2, page 283

REVERSING ENTRY FOR UNEARNED REVENUE INITIALLY RECORDED AS A REVENUE 1 1. Debit the liability account. 2 2. Credit the revenue account. Lesson 10-2, page 284

ADJUSTING ENTRY FOR ACCRUED INTEREST INCOME 1. Calculate interest earned on the notes. 2. Record entry to accrue interest income. Note Principal  Interest Rate  Fraction of Year = Accrued Interest Income 12 $500.00  10%  30/360 = $4.17 13 $700.00  10%  15/360 = 2.92 Total accrued interest income, December 31 . . . . $7.09 1 2 Lesson 10-2, page 285

TERMS REVIEW unearned revenue accrued revenue Lesson 10-2, page 287