Which of the following is true of accrued revenues?
A)Accrued revenues at the end of one accounting period often result in cash receipts from customers in the next period.
B)Accrued revenues at the end of one accounting period often result in cash payments in the next period.
C)Accrued revenues are also called unearned revenues.
D)Accrued revenues are listed on the balance sheet as liabilities.
E)Accrued revenues are recorded at the end of an accounting period because cash has already been received for revenues earned.

Question

Quizplus · Accepted Answer

Accrued revenues are revenues that have been earned but not yet received in cash or recorded in the books. At the end of an accounting period, accrued revenues are recognized by creating an adjusting entry, which increases both revenues and accounts receivable. This means that while the revenue has been earned, the payment from customers is still outstanding. Therefore, accrued revenues at the end of one accounting period often result in cash receipts from customers in the next period.

Which of the Following Is True of Accrued Revenues