Answer:
B. debit Accounts Receivable $350 and credit Unearned Service Revenue $350
Explanation:
When the check was received for services yet to be performed, an asset in form of cash is recorded as well as a liability in form of deferred revenue. If the bookkeeper for Sebadoh Company incorrectly debited Cash for $350 and credited Accounts Receivable for $350. The amounts have been posted to the ledger.
To correct this entry, the amount credited to account receivable would be reclassified to Unearned or deferred revenue. by debiting accounts receivables and crediting unearned/deferred revenue.
