On 15 December, General Stores received cash of $900 in advance for a special order of goods. By 31 December, $400 of the goods had been delivered to the customer. What is the account name and amount of a current liability that will be reported on the balance sheet as at 31 December?

Question

Quizplus · Accepted Answer

Unearned revenue of $500 is reported as a liability because $500 worth of goods are yet to be delivered, representing an obligation to the customer.

On 15 December, General Stores Received Cash of $900 in Advance