Unearned Revenue Definition
Unearned Revenue refers to revenue received before a good is sold or a service is provided. Delivery of the service or product has yet to be fulfilled, for example in case of newspaper subscription or prepayment on a lease contract. Unearned revenue is a current liability on the balance sheet until it is recognized as earned. At the end of each accounting period, adjusting entries must be made to recognize the portion of unearned revenues.