Asked by
Emily Freites
on Dec 16, 2024
Verified
If a business has received cash in advance of services being performed and credits a liability account, the adjusting entry needed after the services are performed will be
A) debit Deferred Revenue and credit Cash.
B) debit Deferred Revenue and credit Sales.
C) credit Deferred Revenue and debit Sales.
D) debit Deferred Revenue and credit Accounts Receivable.
Deferred Revenue
Money received for goods or services which have not yet been delivered or rendered, considered a liability until the service or good is provided.
Adjusting Entry
A journal entry made at the end of an accounting period to allocate income and expenditure to the appropriate period.
- Discern and expound upon the different adjusting entry varieties, namely prepaid expenses, deferred revenues, depreciation, and supplies adjustments.
- Make adjustments for unearned income and understand their significance on the income statement and the statement of financial position.
Verified Answer
ED
Learning Objectives
- Discern and expound upon the different adjusting entry varieties, namely prepaid expenses, deferred revenues, depreciation, and supplies adjustments.
- Make adjustments for unearned income and understand their significance on the income statement and the statement of financial position.