Question

multiple choice question
explain what unearned revenues are by choosing the correct statement below.
unearned revenues refer to customer payments which have not yet been received.
unearned revenues refer to income reported on the income statement.
unearned revenues refer to cash received in advance of providing a service or product.
unearned revenues refer to amounts owed to the company that have not yet been billed.
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Explanation:

Unearned revenues are a liability account. They represent cash a company has received before fulfilling its obligation to provide goods or services, meaning the revenue is not yet earned and cannot be reported on the income statement until the service/product is delivered. The other options are incorrect: unpaid customer payments are accounts receivable, earned income is on the income statement, and unbilled amounts owed are accrued revenues.

Answer:

C. Unearned revenues refer to cash received in advance of providing a service or product.