Accounting for IGCSE & O level - The Fundamentals Of Accounting (Section 27 - No. 15)
What is the impact on the balance sheet when recognizing accrued revenue?
Assets increase, liabilities decrease.
Assets increase, equity increases.
Assets decrease, equity decreases.
Liabilities increase, equity decreases.
Explanation
Accrued revenue increases an asset (e.g., accounts receivable) and increases retained earnings (equity).
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