Accrued revenues are:Group of answer choicesreceived and recorded as liabilities before they are earned.earned and recorded as liabilities before they are received.earned but not yet received or recorded.earned and already received and recorded.
Question
Accrued revenues are:Group of answer choicesreceived and recorded as liabilities before they are earned.earned and recorded as liabilities before they are received.earned but not yet received or recorded.earned and already received and recorded.
Solution
In a service business, revenue is considered earned:
When the service is performed.
Here's why:
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The revenue recognition principle in accounting states that revenue should be recognized when it is earned, which is when the goods or services are provided to the customer.
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In a service business, this means that revenue is considered earned when the service is performed, regardless of when payment is received.
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This is true whether the service is performed over a period of time or at a specific point in time. As soon as the service is performed, the business has fulfilled its obligation and can recognize the revenue.
Similar Questions
Accrued revenues are: Question 4 Answer Earned and recorded as liabilities before they are received Earned and already received and recorded Received and recorded as liabilities before they are earned Earned but not yet received or recorded
Accrued expenses are:Question 1Answera.incurred and already paid or recorded.b.incurred but not yet paid or recorded.c.paid and recorded in an asset account after they are used or consumed.d.paid and recorded in an asset account before they are used or consumed.
Accrued expenses are:Multiple Choicepaid for in one period but not fully used until a later period.paid for, recorded, and used in one period.used in one period but not paid for until a later period.budgeted but not paid for or used during the period
Accrued liabilities are recorded only when payment is made.Group of answer choicesFalseTrue
An accrued expense is an example of a:(5 Points)Prepaid expenseUnearned revenueAccrued liabilityDeferred revenue
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