Deferred revenues can be classified as either current or long term liabilities.

Question

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Deferred revenues represent advance payments received for goods or services that have yet to be delivered or rendered. They can be classified as current liabilities if they are expected to be fulfilled within one year or the operating cycle, whichever is longer. If the fulfillment period exceeds one year, they are classified as long-term liabilities.

Deferred Revenues Can Be Classified as Either Current or Long