How is revenue recorded from a collection of $1,450,000?

The recording of revenue from a collection involves recognizing both the receipt of cash and the corresponding increase in revenue. When a governmental entity collects funds, the following journal entry captures this transaction accurately.

By debiting Cash for $1,450,000, the entry reflects an increase in the cash account, as this is the amount received. Crediting Revenues Control for the same amount signifies that revenue has been earned and recognized on the entity's books. This aligns with the accrual accounting principles adopted by governmental entities, which state that revenues should be recognized when they are earned, rather than when cash is received.

This method of recording ensures an accurate portrayal of the financial status of the entity, highlighting both the inflow of cash and the recognition of earned revenues in the financial statements. The other options do not accurately reflect the principles of revenue recognition or the correct accounting treatment for this transaction.