Unearned Revenue Arises from the Acceptance of Payment in Advance

question 67

True/False

Unearned revenue arises from the acceptance of payment in advance for a service to be performed.

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Definitions:

Raw Material

Fundamental substances utilized during the manufacturing process to create products.

Standard Cost System

An accounting system that uses cost estimates for material, labor, and overhead to assign costs to products and analyze variances.

Fixed Manufacturing Overhead Rate

A consistent charge per unit of production or period that allocates the total fixed manufacturing overhead costs.

Variances

The difference between expected and actual performance or costs in business operations.