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Deferred Revenue Entry

Hi! I am trying to figure out the best way to record an entry for the following scenario.

I have a 12 month subscription that started in January but I did not bill out the full 12 month bill until May. Not our usual process but it was missed.

I am trying to find a way to book this as deferred revenue over the 12 month subscription period, without having to mess with my AR entries for May.

Answers

Len Green
Title: Performance Improvement Consultant and E..
Company: Haygarth Consulting LLC
LinkedIn Profile
(Performance Improvement Consultant and ERP Strategist, Haygarth Consulting LLC) |

May entries:
Dr AR 1200
Cr Deferred Rev 1200
That is for the bill you raised in May.
Then recognize that 5 months have been earned
Dr Deferred Rev 500
Cr Revenue 500
Then chase your customer to bring their payments up to date:)

In June, July etc
Dr Deferred Rev 100
Cr Revenue 100

I assume the amounts are not material

Anonymous
(Asst Controller) |

Thank you! That totally makes sense. Not sure why i was making it more difficult than it needed to be.

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