Jack’s Snow Removal Company received a cash advance of $6,000 on December 1, 2016 to provide services during the months of December, January, and February. The 2016 year-end adjustment to recognize the partial expiration of the contract will
A. increase assets by $2,000
B.increase equity by $2,000
C. increase liabilities by $2,000
D. increase assets by $2,000 and increase equity by $2,000
Answer:B
Jack’s Snow Removal Company received a cash advance of $6,000 on December 1, 2016 to provide services during the months of December, January, and February. The 2016 year-end adjustment to recognize the partial expiration of the contract will
A. increase assets by $2,000 B.increase equity by $2,000 C. increase liabilities by $2,000 D. increase assets by $2,000 and increase equity by $2,000