Lou was paid $280 by Eagles Landing subdivision. How would you record this transaction?

Lou was paid $280 by Eagles Landing subdivision. How would you record this transaction?

• A. $280 Debit Cash and $280 Credit Lawncare Revenue
• B. $280 Debit Lawncare Revenue and $280 Credit Cash
• C. $280 Debit Cash and $280 Debit Lawncare Revenue
• D. $280 Credit Cash and $280 Credit Lawncare Revenue

Answer: (A)

When money is received for services, you increase the cash asset and you record the earned revenue. In double-entry terms, increases to assets are debited and increases to revenue are credited. Since Eagles Landing subdivision paid 280, the correct entry is to debit Cash for 280 and credit Lawncare Revenue for 280. This shows more cash on hand and the recognition of income from the lawn care service. The other options would misstate the accounts: debiting the revenue account would wrongly increase an income account, debiting both accounts would double-count the transaction, and crediting cash would reduce cash instead of reflecting the receipt.

When money is received for services, you increase the cash asset and you record the earned revenue. In double-entry terms, increases to assets are debited and increases to revenue are credited. Since Eagles Landing subdivision paid 280, the correct entry is to debit Cash for 280 and credit Lawncare Revenue for 280. This shows more cash on hand and the recognition of income from the lawn care service.

The other options would misstate the accounts: debiting the revenue account would wrongly increase an income account, debiting both accounts would double-count the transaction, and crediting cash would reduce cash instead of reflecting the receipt.