Unearned revenues are
A)received and recorded as liabilities before they are earned.
B)earned and recorded as liabilities before they are received.
C)earned but not yet received or recorded.
D)earned and already received and recorded.

Question

Quizplus · Accepted Answer

Unearned revenues are received from customers in advance for goods or services that the company has not yet delivered or performed. Therefore, they are recorded as liabilities on the balance sheet until the company fulfills its obligation, at which point they are recognized as revenue.

Unearned Revenues Are