The adjusting entry to an unearned revenue account will
A)decrease liabilities and increase revenues.
B)increase liabilities and increase revenues.
C)increase assets and increase revenues.
D)decrease revenues and decrease assets.

Question

Quizplus · Accepted Answer

The adjusting entry for unearned revenue decreases liabilities because it recognizes that the obligation to provide goods or services has been fulfilled, and it increases revenues as the income is now earned.

The Adjusting Entry to an Unearned Revenue Account Will