{"id":3001,"date":"2024-09-06T13:29:18","date_gmt":"2024-09-06T10:29:18","guid":{"rendered":"https:\/\/akaunting.com\/hc\/?post_type=glossary&p=3001"},"modified":"2024-09-06T15:14:11","modified_gmt":"2024-09-06T12:14:11","slug":"deferred-revenue","status":"publish","type":"glossary","link":"https:\/\/akaunting.com\/hc\/terms\/deferred-revenue\/","title":{"rendered":"Deferred Revenue"},"content":{"rendered":"\n

What is a Deferred Revenue?<\/strong><\/h2>\n\n\n\n

Deferred revenue is a liability account on a company’s balance sheet that represents revenue that has been earned but not yet collected. It is created when a company receives payment for goods or services that will be delivered or performed in the future.<\/p>\n\n\n\n

For example, a company might sell a subscription to a service that will be delivered over the course of a year. The company would record the subscription revenue as deferred revenue when the customer pays, and then recognize the revenue as it is earned over the course of the year.<\/p>\n\n\n\n

Deferred revenue is a common accounting practice for businesses that sell goods or services that will be delivered or performed in the future. It is important to track deferred revenue because it can have a significant impact on a company’s financial statements.<\/p>\n\n\n\n


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Frequently Asked Questions<\/strong><\/h2>\n\n\n\n

Is deferred revenue an asset or expense?<\/strong><\/h3>\n\n\n\n

Deferred revenue is not an asset or expense. It is a liability account on a company’s balance sheet that represents revenue that has been earned but not yet collected. It is created when a company receives payment for goods or services that will be delivered or performed in the future.<\/p>\n\n\n\n

Is deferred revenue a liability or equity?<\/strong><\/h3>\n\n\n\n

Deferred revenue is a liability account on a company’s balance sheet. This means that it is a debt that the company owes to its customers.<\/p>\n\n\n\n

Is deferred revenue a debt?<\/strong><\/h3>\n\n\n\n

Deferred revenue is a debt because it represents a future obligation to the customer.<\/p>\n\n\n\n

What is the difference between accrued revenue and deferred revenue?<\/strong><\/h3>\n\n\n\n

Deferred revenue represents revenue that has been earned but not yet collected, while accrued revenue represents expenses that have been incurred but not yet paid.<\/p>\n\n\n\n


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Is deferred revenue the same as accounts receivable?<\/strong><\/h3>\n\n\n\n

No, deferred revenue is not the same as accounts receivable. Deferred revenue is a liability account on a company’s balance sheet that represents revenue that has been earned but not yet collected. Accounts receivable, on the other hand, is an asset account on a company’s balance sheet that represents money that is owed to the company by its customers.<\/p>\n","protected":false},"menu_order":0,"template":"","letter":[24],"class_list":["post-3001","glossary","type-glossary","status-publish","hentry","letter-d"],"acf":[],"_links":{"self":[{"href":"https:\/\/akaunting.com\/hc\/wp-json\/wp\/v2\/glossary\/3001","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/akaunting.com\/hc\/wp-json\/wp\/v2\/glossary"}],"about":[{"href":"https:\/\/akaunting.com\/hc\/wp-json\/wp\/v2\/types\/glossary"}],"version-history":[{"count":1,"href":"https:\/\/akaunting.com\/hc\/wp-json\/wp\/v2\/glossary\/3001\/revisions"}],"predecessor-version":[{"id":3002,"href":"https:\/\/akaunting.com\/hc\/wp-json\/wp\/v2\/glossary\/3001\/revisions\/3002"}],"wp:attachment":[{"href":"https:\/\/akaunting.com\/hc\/wp-json\/wp\/v2\/media?parent=3001"}],"wp:term":[{"taxonomy":"letter","embeddable":true,"href":"https:\/\/akaunting.com\/hc\/wp-json\/wp\/v2\/letter?post=3001"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}