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  2. Adjusting entries - Wikipedia

    en.wikipedia.org/wiki/Adjusting_entries

    In accounting, adjusting entries are journal entries usually made at the end of an accounting period to allocate income and expenditure to the period in which they actually occurred. The revenue recognition principle is the basis of making adjusting entries that pertain to unearned and accrued revenues under accrual-basis accounting .

  3. Basis of accounting - Wikipedia

    en.wikipedia.org/wiki/Basis_of_accounting

    For financial accounting purposes, accrual accounting generally follows the principle that revenue cannot be recognized until it is earned, even if payment has been received in advance. [7] The specifics of accrual accounting can vary across jurisdictions, though the overarching principle of recognizing revenue and expenses when they are earned ...

  4. Revenue recognition - Wikipedia

    en.wikipedia.org/wiki/Revenue_recognition

    The unearned income is deferred and then recognized to income when cash is collected. [6] For example, if a company collected 45% of total product price, it can recognize 45% of total profit on that product. Cost recovery method is used when there is an extremely high probability of uncollectable payments. Under this method no profit is ...

  5. 4 Types of Unearned Income That Could Affect Your Taxes - AOL

    www.aol.com/4-types-unearned-income-could...

    Unearned income, also known as passive income, is derived from sources other than employment or business operations and can act as a financial safety net during times of job loss or financial crisis.

  6. Accounting for leases in the United States - Wikipedia

    en.wikipedia.org/wiki/Accounting_for_leases_in...

    Nonrefundable security deposits: Deferred by the lessor as unearned revenue; Capitalized by the lessee as a prepaid rent expense until the lessor considers the deposit earned. Refundable security deposits: Treated as a receivable by the lessee; Treated as a liability by the lessor until the deposit is refunded to the lessee.

  7. Earned vs. Unearned Income: Do You Really Know the ... - AOL

    www.aol.com/earned-vs-unearned-income-really...

    Unearned income: Unearned income may be subject to federal income tax, but the rates and rules can vary based on the type of income. Some forms of unearned income, like capital gains, may benefit ...

  8. Liability (financial accounting) - Wikipedia

    en.wikipedia.org/wiki/Liability_(financial...

    They usually include payables such as wages, accounts, taxes, and accounts payable, unearned revenue when adjusting entries, portions of long-term bonds to be paid this year, and short-term obligations (e.g. from purchase of equipment). Current liabilities are obligations whose liquidation is reasonably expected to require the use of current ...

  9. Journal entry - Wikipedia

    en.wikipedia.org/wiki/Journal_entry

    A journal entry is the act of keeping or making records of any transactions either economic or non-economic. Transactions are listed in an accounting journal that shows a company's debit and credit balances. The journal entry can consist of several recordings, each of which is either a debit or a credit. The total of the debits must equal the ...