The Unearned Revenue account normally has a debit balance.

Question

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The Unearned Revenue account normally has a credit balance. This account represents a liability to the company because the revenue has been received but the goods or services have not been delivered yet. As the company delivers the goods or services, the unearned revenue is gradually converted into earned revenue, reducing the balance of the Unearned Revenue account and increasing the balance of the Revenue account.

The Unearned Revenue Account Normally Has a Debit Balance