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Adjusting Entries: Accrued Revenues definitions

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  • Accrued Revenues
    Earnings recognized before cash is received, typically from delivering goods or services on credit to customers.
  • Accounts Receivable
    Asset representing amounts owed by customers who have received goods or services but have not yet paid.
  • Asset
    Resource owned by a company, such as money owed by customers, that provides future economic benefit.
  • Revenue Recognition Principle
    Guideline requiring revenue to be recorded when it is earned, regardless of when cash is received.
  • Credit Sale
    Transaction where goods or services are provided to a customer who agrees to pay at a later date.
  • Adjusting Entry
    Accounting record made at the end of a period to update account balances before preparing financial statements.
  • Debit
    Accounting entry that increases assets or expenses and decreases liabilities or equity.
  • Credit
    Accounting entry that increases liabilities, equity, or revenue and decreases assets or expenses.
  • Outstanding Balance
    Portion of an amount owed by a customer that remains unpaid after a partial payment.
  • Accrual Accounting
    Method where transactions are recorded when they occur, not when cash is exchanged.
  • On Account
    Term indicating a transaction where payment is deferred and will be made at a future date.
  • IOU
    Informal reference to an amount owed by a customer, reflected as an asset until payment is received.
  • Partial Payment
    Situation where a customer pays only a portion of the total amount owed, leaving a remaining balance.