At Times, Businesses Require Advance Payments from Customers That Will

question 48

Multiple Choice

At times, businesses require advance payments from customers that will be applied to the purchase price when goods are delivered or services provided. These customer advances represent:

• A) Liabilities until the product or service is provided.
• B) A component of shareholders' equity.
• C) Long-term assets until the product or service is provided.
• D) Revenue upon receipt of the advance payment.

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