Deferred revenue: Is it a liability & how to account for it?

This occurs when a company receives payment for goods or services that it hasn’t yet provided to the customer. Instead, the company recognizes the revenue over time as the goods or services are delivered or completed. In accrual accounting, you can have deferred revenue when you receive advance payments for services or products to be provided later. However, under cash basis accounting, deferred revenue isn’t applicable as revenue is ...

Debits vs Credits: Understanding Accounting Entries

One common example of a contra account is the accumulated depreciation account. This account is used to offset the value of an organization’s fixed assets. The accumulated depreciation account is used to reflect this decrease in value. In a journal entry, you record the details of the transaction, while in a ledger entry, you summarize and organize them. Furthermore, utilize technology to streamline your journal entry process. Many accounting ...

7 10 The Performance Report Managerial Accounting

At the beginning of January, Amara generated the actual income statement showing the actual revenue earned and expenses incurred. The planning budget income statement and the actual income statement are provided in Exhibit 7-4. Vera, a self-trained chef, opened a new restaurant called Vera’s Vittles in a historic, inner-city neighborhood. Her menu showcases classic Southern dishes passed down from her great grandmother. Since opening ...

Check Your Status UTSA Admissions

The payor is the entity who writes the check, while the payee is the person or institution to whom it is written. An outstanding check also refers to a check that has been presented to the bank but is still in the bank’s check-clearing cycle. After remitting funds, update your accounting records to reflect the escheatment. Adjust ledger entries and clear the outstanding checks from your open liabilities. What Are Some Best Practices for ...