To record revenue that has been received but not yet earned, an entry is made that increases a liability account.

Name: To record revenue that has been received but not yet earned, an entry is made that increases a liability account.
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Question

Quizplus · Accepted Answer

This is because the revenue received in advance is considered unearned and is recorded as a liability on the balance sheet until the goods or services are delivered, at which point it is recognized as earned revenue.

To Record Revenue That Has Been Received but Not Yet