All of the following are true regarding unearned revenues except:
A) The adjusting entry for unearned revenues increases assets and increases revenues.
B) The adjusting entry for unearned revenues increases revenues and decreases liabilities.
C) They are payments received in advance of services performed.
D) They are liabilities.
E) As they are earned, they become revenues.

Question

Quizplus · Accepted Answer

The adjusting entry for unearned revenues decreases liabilities and increases revenues, not assets.

All of the Following Are True Regarding Unearned Revenues Except