Fragmental Co leased a portion of ts store to another compan

Fragmental Co. leased a portion of ts store to another company for eight months beginning on October t at a monthly rate of Stoso. F recorded it as uneamed revenue. Assuming adjusting entries are only made at year end, the adjusting entry made by Fragmental Co. the entire $8.400 cash on October 1 and on December 31 would be:

Solution

A debit to Unearned Rent and a credit to Rent Earned for $3,150.

$8,400 * 3/8 = $3,150 earned by December 31