On January 1,Acme College received $1,200,000 in Unearned Tuition Revenue from its students for the spring semester,which spans four months beginning on January 2.What amount of tuition revenue should the college recognize on January 31?
A)$300,000
B)$600,000
C)$800,000
D)$900,000
E)$1,200,000

Question

Quizplus · Accepted Answer

The college should recognize revenue proportionally over the period the service is provided. Since the semester spans four months, the revenue recognized for one month (January) is $1,200,000 / 4 = $300,000.

On January 1,Acme College Received $1,200,000 in Unearned Tuition Revenue