Question

Recording revenue before it is collected is an example of: Multiple Choice A prepaid expense transaction. A deferred revenue transaction. An accrued liability transaction.

Answer 1

Answer:

An Accrued Receivable transaction

Explanation:

Before the receipt of cash recording a revenue is the example of accrued receivable because product is sold or services are already been performed on which basis transaction is occurred and recorded. So, the receivable is recorded against the revenue entry.

The journal Entry for this transaction will be as follow

DR. Account receivable  xxx

CR.  Revenue                   xxx