If Unearned Revenues Are Initially Recorded in Revenue Accounts and Have

question 94

Multiple Choice

If unearned revenues are initially recorded in revenue accounts and have not all been earned at the end of the accounting period, then failure to make an adjusting entry will cause

• A) liabilities to be overstated.
• B) revenues to be understated.
• C) revenues to be overstated.
• D) accounts receivable to be overstated.

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Definitions:

Price of Cola

The amount of money required to purchase a unit or specified quantity of cola.

System of Rationing

A method for distributing scarce goods and services using criteria other than price, often implemented during shortages to ensure equitable distribution.

Free Market Price

The price of goods or services determined by supply and demand in a free market, without government intervention.

Consumer Behavior

The examination of how individuals, groups, or organizations choose, acquire, consume, and discard products, services, experiences, or concepts to fulfill their needs, and how these actions affect both the consumer and the broader community.