If a business has received cash in advance of services being performed and credits a liability account, the adjusting entry needed after the services are performed will be
A)debit Deferred Revenue and credit Cash.
B)debit Deferred Revenue and credit Sales.
C)credit Deferred Revenue and debit Sales.
D)debit Deferred Revenue and credit Accounts Receivable.

Question

Quizplus · Accepted Answer

When services are performed, the liability (Deferred Revenue) is reduced, and revenue (Sales) is recognized, so you debit Deferred Revenue and credit Sales.

If a Business Has Received Cash in Advance of Services