Unearned revenues are generally:
A)Revenues that have been earned and received in cash.
B)Revenues that have been earned but not yet collected in cash.
C)Liabilities created when a customer pays in advance for products or services before the goods or services are delivered.
D)Recorded as an asset in the accounting records.
E)Increases to common stock.

Question

Quizplus · Accepted Answer

Unearned revenues are revenues that have been received in advance from customers for goods or services that have not yet been delivered. They are recorded as a liability on the balance sheet because the company still owes the customer the goods or services. As the goods or services are delivered, the liability is reduced and revenue is recognized.

Unearned Revenues Are Generally