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Vitek1552 [10]
2 years ago
10

A liability created when a business collects cash from customers in advance of providing services or delivering goods is called?

a(n)
Business
1 answer:
Bumek [7]2 years ago
3 0
<span> <span>The liability created by receiving cash before providing the service or delivering the goods in question is called unearned revenue. In this case, the entity providing the goods/services records this transaction as revenue that has been generated but in real sense, the seller remains with the liability until after the actual delivery of the goods/services. The purpose of this practice can be advantageous to the seller in certain situations such as easing the burden of paying interest on debts.</span></span>
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