What Is Unearned Revenue?


4 Answers

Anonymous Profile
Anonymous answered
Unearned revenue is the monies received ahead of the product or service having been provided. If I prepay on a lease, for example, but haven't used the full term of the lease yet-- or if I pay a company for a sofa which I have yet to receive. Unearned revenue is counted as a liability on the books of a company until the service or product has been provided. Does that help?
Aisha Profile
Aisha answered
Revenue is basically the amount of money received by a company from its activities during a certain time period. The concept of Unearned Revenue is based on the accounting principle of recognition of revenue when it is received. So unearned revenue is a form of asset. And according to the choices you have given, it is a form of revenue that is not collected and currently matched with expenses.
For more details see the link below:
Hilaria Manalo Profile
Hilaria Manalo answered
Unearned revenue is the money earned after a service is done or delivered that is on an agreement.

It is really not a revenue yet, but it is called a revenue already because it is agreed with the figures and contract/invoice. This will be an accounts receivable by the company once the service or product is delivered. Rental is best example of this..
thanked the writer.
Anonymous commented
That is inaccurate. Unearned revenue is revenue collected BEFORE the service is done or delivered.

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