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Flores Company publishes a monthly sports magazine, Hunting Preview

Accounting

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Flores Company publishes a monthly sports magazine, Hunting Preview. Subscriptions to the magazine cost $20 per year. During October 2011, Flores sells 18,000 subscriptions beginning with the November issue. Flores prepares financial statements quarterly and recognizes subscription revenue earned at the end of the quarter. The company uses the accounts Unearned Subscriptions and Subscription Revenue.

Instructions

(a)     Prepare the entry in October for the receipt of the subscriptions.

(b)     Prepare the adjusting entry at December 31, 2011, to record subscription revenue earned in December 2011.

(c)     Prepare the adjusting entry at March 31, 2012, to record subscription revenue earned in the first quarter of 2012.