Answer Posted / jai

Deferred revenue is not yet revenue. It is an amount that
was received by a company in advance of earning it. The
amount unearned (and therefore deferred) as of the date of
the financial statements should be reported as a liability.
The title of the liability account might be Unearned
Revenues or Deferred Revenues.
When the deferred revenue becomes earned, an adjusting
entry is prepared that will debit the Unearned Revenues or
Deferred Revenues account and will credit Sales Revenues or
Service Revenues.

EXPAND_________SEB

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