Unearned revenue also called deferred revenue) can occur when
A) services are provided prior to receipt of cash.
B) goods are sold on account.
C) services are provided after the receipt of cash.
D) goods are sold for cash.

Question

Quizplus · Accepted Answer

Unearned revenue, or deferred revenue, occurs when a company receives payment for goods or services before they are provided to the customer. Choice C is correct because it describes a scenario where cash is received before the services are provided, which leads to unearned revenue on the company's balance sheet.

Unearned Revenue Also Called Deferred Revenue) Can Occur When