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Question
unearned revenue is classified as
a contra - revenue account.
a revenue account.
a liability account.
an asset account.
etextbook and media
Brief Explanations
Unearned revenue represents money received for goods or services not yet provided, which creates an obligation (liability) to fulfill the service or deliver the goods. Contra - revenue accounts reduce revenue (e.g., sales returns), revenue accounts record earned revenue, and asset accounts represent resources owned. So unearned revenue is a liability.
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C. a liability account.