Which of the Following Correctly Describes the Effects of Initially

question 109

Multiple Choice

Which of the following correctly describes the effects of initially recording deferred revenue when cash is received from a customer?

• A)Revenue is increased.
• B)Liabilities are not affected.
• C)Retained earnings increases.
• D)Net income is not affecteD.Deferred revenue recorded when cash is received from a customer increases the unearned revenue account and increases cash.These are balance sheet accounts that do not impact net income.

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Definitions:

Deflections

Movements of an object or path away from its original course, often due to external forces or influences.

ECG

Electrocardiogram, a medical test that measures the electrical activity of the heart to identify various heart conditions.

Letters

Written symbols representing sounds or phonemes, forming the building blocks of written words in alphabetic systems.

Pulmonary Function Tests

A group of tests that measure how well the lungs take in and release air, and how efficiently they transfer oxygen into the blood.