Which of the following situations involves a deferral?
A)Recording accrued interest
B)Recording accrued wages
C)Recording revenue earned but not yet received
D)Recording revenue earned that was collected in advance
E)None of the above are deferrals.

Question

Quizplus · Accepted Answer

Deferrals involve recognition of revenue or expenses in a period different from when the cash is exchanged. Recording revenue that was collected in advance is a deferral because the cash is received before the revenue is earned, and the revenue is recognized in a later period when it is earned.

Which of the Following Situations Involves a Deferral