0
Why is unearned revenue a liability instead of a revenue account?
Wiki User
∙ 14y ago
Unearned revenue accounts represent the amount of cash received before services are provided. Since services have not been provided yet, it is not revenue. (It represents the obligation for future services in order for the revenue to be earned.)
Wiki User
∙ 14y ago
Add your answer:
Earn +20 pts
Unearned revenue is a contra revenue account?
Unearned Revenue is a Liability Account
What kind of account is unearned revenue?
Unearned Revenue is a liability account.
What type of account is unearned service revenue?
Unearned Service Revenue is a Liability account.
Unearned revenue account is classified as a?
Unearned revenue account is classified as current liability as it is the revenue not yet earned by business.
Is unearned revenue is nominal account?
Unearned ravenue is liability account as revenue is not yet earned but cash received.
Unearned revenue is a contra revenue account?
Unearned Revenue is a Liability Account
What kind of account is unearned revenue?
Unearned Revenue is a liability account.
What type of account is unearned revenue?
Unearned Service Revenue is a Liability account.
What type of account is unearned service revenue?
Unearned Service Revenue is a Liability account.
Unearned revenue account is classified as a?
Unearned revenue account is classified as current liability as it is the revenue not yet earned by business.
Is unearned revenue is nominal account?
Unearned ravenue is liability account as revenue is not yet earned but cash received.
Are Unearned Revenue is a contra asset account?
No. It's a liability account.
What is the nature of the unearned revenue?
unearned revenue falls under the head of nominal account and it is definaltel a liability on the organization.
Do unearned fees go into an income statement?
Not right away. When you record unearned fees or revenue it only hits the balance sheet. Ex: Debit- Cash or AR (Asset Account) Credit- Unearned Revenue (Liability) It is a liability until the revenue is earned in which case you then Debit: Unearned Revenue Credit: Revenue/Sales Account (finally and income statement account!)
What type of account is Unearned revenue and what its normal balance?
Unearned revenue is a liability account. It is revenue that is received in one fiscal period despite the fact that revenue is not earned until another fiscal period. Its normal balance is credit.
Is Unearned revenue credit or debit?
If you sell goods that have yet to be delivered you would create an account for unearned revenue. Unearned revenue is a liability account because you are still liable to produce those goods so if you are increasing the amount of unearned revenue you would credit the account, however if you are decreasing the unearned revenue, meaning you have supplied the goods to the customer, then you would debit the account.
What are examples of liability account?
A liability account is anything the company owes. Accounts Payable, Notes Payable, these are two examples of a liability account. Unearned Revenue is another example of a liability account. Unearned revenue is revenue a company has received but has not yet fulfilled their obligation to the customer. Because the company is now liable for either providing the product (or service) to the customer or refunding the money paid by said customer, it is a liability account until all obligations are fulfilled.
