What effect does "recognizing revenue at the end of the accounting period for rent previously received in advance" have on the accounting equation for the insurance company?

Question

Quizplus · Accepted Answer

When rent is received in advance, it is recorded as a liability (unearned revenue). Recognizing this revenue at the end of the accounting period decreases liabilities (as the obligation to provide services is fulfilled) and increases stockholders' equity (as earned revenue increases net income, which is part of equity).

What Effect Does "Recognizing Revenue at the End of the Accounting