wellness, a healthy living magazine, collected $ 516 comma 000$516,000 in subscription revenue on may 31. each subscriber will receive an issue of the magazine in each of the next 12 months, beginning with the june issue. the company uses the accrual method of accounting. what is the balance in the unearned revenue account as of december 31?

$215000

Step-by-step explanation:

The company using the accrual method means that it it records revenue when it is earned and expenses when they are incurred. Therefore the company at 31 December will have a revenue for 7 months of beginning of April until end of December. This value is 7/12 multiplied by the $516000 because a 12 month period will end on the 31st of May for the following year. Therefore the unearned revenue balance will equal $215000 because $516000 - $301000(the 7 months that were earned until 31 Decemeber) = $215000 .

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step-by-step explanation: