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Question 24 (1 Point) Unearned Revenue Is Considered a Liability Until the Service Is Performed or the Product Is Delivered. True False

Question

Question 24 (1 point) Unearned revenue is considered a liability until the service is performed or the product is delivered. True False

Solution

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Julian Elite ยท Tutor for 8 years

Answer

True. Unearned revenue represents money received for goods or services that haven't yet been provided. It's a liability because the company has an obligation to deliver those goods or services in the future. Once the obligation is fulfilled, the unearned revenue is recognized as earned revenue.