Reference no: EM132671990

Question - Splish Splash Art is a centre that offers children's music and dance lessons. Splish Splash prepares annual financial statements and has a December 31, 2020, year-end.

1. On September 1, Splish Spash Art collects $20,300 cash for dance lessons running from September 1, 2020 to December 31, 2020.

2. On October 1, Splish Splash Art collects $6,600 cash in advance from the Music Box Inc. ($3,300 per month) to rent its performance stage for the full month of December 2020 and January 2021.

3. On October 1, 2020, Splish Splash Art collects $10,400 cash for four months of music lessons for a local private school. The lessons run from October 1, 2020 to January 31, 2021.

Required - For the above transactions, record the initial journal entry and the adjusting entry required on December 31, 2020.

Transaction lists are as follows

a. 1. Record cash received in advance for future dance lessons.

2. Record annual adjusting entries for earned revenue received in advance.

b. 1. Record the cash received for stage rental.

2. Record the earned portion of revenue received in advance.

c. 1. Record cash received in advance for future music lessons.

2. Record the earned portion of revenue received in advance.