A liability created when a business collects cash from customers in advance of providing services or delivering goods is called:
A)notes receivable.
B)unearned revenues.
C)capital.
D)revenues.

Question

Quizplus · Accepted Answer

Unearned revenues are liabilities created when a business receives cash from customers in advance of providing services or delivering goods. This is because the business owes the service or product to the customer, and until it is provided, the revenue cannot be recognized as earned. Notes receivable refers to money owed to the business by a customer who signed a promissory note. Capital refers to the owner's equity in the business. Revenues refer to the income earned by the business from providing services or delivering goods.

A Liability Created When a Business Collects Cash from Customers