Which of the following does not apply to unearned revenues?
A. May also be called deferred revenues.
B. They are amounts received in advance from customers for future products or services.
C. Gift cards are an example.
D. They can result from advance ticket sales.
E. Classified as a long-term asset
Answer (2)
Unearned revenues are amounts received in advance from customers and are classified as liabilities, not long-term assets. Examples include gift cards and advance ticket sales. The key point is that they represent cash received before any services are rendered or products are delivered. ;
Unearned revenues are amounts received from customers ahead of services or products being provided and are classified as liabilities. They include examples like gift cards and advance ticket sales. The statement that they are classified as a long-term asset is incorrect.
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