Unearned revenues are
A) cash received and a liability recorded before services are performed.
B) revenue for services performed and recorded as liabilities before they are received.
C) revenue for services performed but not yet received in cash or recorded.
D) revenue for services performed and already received in cash and recorded.

Question

Quizplus · Accepted Answer

Unearned revenues are cash received and a liability recorded before services are performed. This means that the company has received payment from a customer in advance for a service or product that has not yet been provided. The liability is recorded on the balance sheet until the service or product is delivered, at which point the liability is reduced and revenue is recognized.

Unearned Revenues Are