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The accountant of Omega Consulting failed to make an adjusting entry to record $6,000 for unearned service revenues that were earned before the end of the fiscal year.Assume the company initially recorded a liability.Which of the following statements is true?
Accrued Revenue
Income earned but not yet received, typically recorded with an adjusting journal entry.
Prepaid Expense
Prepaid expense refers to payments made in advance for goods or services to be received in the future, recognized as assets on a balance sheet.
Unearned Service Revenue
Income received in advance for services that have not yet been performed, considered a liability until the service is delivered.
Adjusting Entries
Adjustments in accounting records at the end of a period to correctly distribute incomes and costs to the period they pertain to.
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