What effect will this adjustment have on the accounting records?

Unearned Revenue 3,300
Fees earned 3,300

a. Increase net income
b. Increase revenues reported for the period
c. Decrease liabilities
d. All are true.

a.Increase Net Income

Explanation:

Unearned Revenue

The Accrual Principle requires Incomes and expenses to be recorded in the period they occur or incur.

Revenue not earned has not yet occurred and can not be recognized hence no effect on revenues reported for the period.

Fees earned

Fees earned represents increases in economic benefits from non primary activities of the company.

This has the overall effect of increasing Net income in the reporting period

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