Received Cash For Services Performed

A business can provide services in return for greenbacks. The service is provided to the customer and payment from the customer is immediate using cash. There is no credit given to the customer for the provision of the service.

Suppose for example, the business organisation provides services to a customer and receives immediate payment for cash for the amount of 500, then the journal entries will be every bit follows.

Journal Entry for Greenbacks Received for Services Provided

The accounting records will show the following bookkeeping entries for the cash received for services provided:

Cash received for services provided journal
Account	Debit	Credit
Cash	500
Service revenue		500
Total	500	500

Cash Received for Services Provided Accounting Explained

Debit
Greenbacks is received from the customer for the provision of the services.

Credit
The credit entry to the service revenue account records the revenue earned equally a upshot of providing the service.

The Accounting Equation

The Accounting Equation, Assets = Liabilities + Owners Equity means that the total assets of the business are always equal to the total liabilities of the business This is true at whatever time and applies to each transaction. For this transaction the Accounting equation is shown in the following table.

cash received for services provided

In this case i nugget (greenbacks) increases representing coin received from the client, this increment is balanced by the increase in owners equity. The credit to the income statement for the service revenue increases the internet income which increases the retained earnings and therefore the owners disinterestedness in the business concern.

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Well-nigh the Author

Chartered auditor Michael Dark-brown is the founder and CEO of Double Entry Bookkeeping. He has worked as an auditor and consultant for more than 25 years and has built financial models for all types of industries. He has been the CFO or controller of both small and medium sized companies and has run small businesses of his own. He has been a manager and an auditor with Deloitte, a large 4 accountancy firm, and holds a degree from Loughborough University.

Nov 21, 2019