Unearned revenues are:
A) Amounts received in advance from customers for future delivery of products or services.
B) Not recorded as liabilities.
C) The same as accrued revenues.
D) Reduce assets.
E) All of these answers are correct.

Question

Quizplus · Accepted Answer

Unearned revenues are amounts received in advance from customers for future delivery of products or services. These are considered a liability until the goods or services are delivered or performed.

B, C, and D are incorrect as unearned revenues are recorded as liabilities and are not the same as accrued revenues, which are revenues that have been earned but not yet received or recorded, and they do not reduce assets.

Therefore, the best choice is A.

Unearned Revenues Are