Unearned revenue is reported in the financial statements as:
A)A revenue on the balance sheet.
B)A liability on the balance sheet.
C)An unearned revenue on the income statement.
D)An asset on the balance sheet.
E)A financing activity on the statement of cash flows.

Question

Quizplus · Accepted Answer

Unearned revenue represents money received in advance for goods or services that have not yet been provided. Therefore, it is considered a liability, as the company has an obligation to deliver the goods/services or refund the money. It is reported on the balance sheet under the liability section.

Unearned Revenue Is Reported in the Financial Statements As