Purpose: (L.O. 3) This exercise will illustrate the accounting for unearned revenue.
Soap Opera Summarized is published by Viewer Publishers. Subscriptions to the magazine are sold for a one-year, two-year, or three-year period. Cash receipts from subscribers are credited to Unearned Subscription Revenue, and this account had a balance of $3,000,000 at December 31, 2014, before adjustment. Outstanding subscriptions at December 31, 2014, expire as follows: