An adjusting entry that increases an asset and increases a revenue is known as a(n):
A)Accrued expense.
B)Deferred expense.
C)Deferred revenue.
D)Accrued revenue.
E)Depreciation.

Question

Quizplus · Accepted Answer

An adjusting entry that increases an asset and increases a revenue is known as an accrued revenue. This occurs when a company has earned revenue but has not yet received payment for it. The revenue is recorded as an asset (accounts receivable) until it is collected, and the adjusting entry recognizes the revenue as earned for the period.

An Adjusting Entry That Increases an Asset and Increases a Revenue