Accrued revenues are revenues that have been earned but not yet collected or recorded. They require an adjusting entry to increase a revenue and a corresponding asset (accounts receivable). Option A is incorrect because collected revenues have already been earned. Options C and D describe adjusting entries for deferred revenues and not for accrued revenues.

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Accrued Revenues

Question 17

Multiple Choice

Accrued revenues:

A) are revenues not yet earned but have been collected or recorded.
B) are revenues earned but not yet collected or recorded.
C) require an adjusting entry to decreases (credits) an asset and increases (debit) a revenue.
D) require an adjusting entry to decrease (credits) a revenue and increase (debit) a liability.

Correct Answer: