Receiving cash in advance from a customer for services to be provided in the future causes assets to increase and stockholders' equity to increase.

Name: Receiving cash in advance from a customer for services to be provided in the future causes assets to increase and stockholders' equity to increase.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

Receiving cash in advance increases assets (cash) and creates a liability (unearned revenue), not stockholders' equity, as the service has not yet been provided.

Receiving Cash in Advance from a Customer for Services to Be