Contract liability is a company's obligations to transfer goods or services to a customer for which the company has received consideration from the customer.An example of a contract liability is
A)Prepaid subscription.
B)Unearned magazine subscription.
C)Mortgage Payable.
D)Service Revenue.

Question

Quizplus · Accepted Answer

Unearned magazine subscription is a contract liability because the company has received payment but has not yet delivered the magazines to the customer.

Contract Liability Is a Company's Obligations to Transfer Goods or Services