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What Is Deferred Revenue? Journal Entry and Examples

xendoo

If you overdo it, you may misrepresent your earnings and violate accounting rules. . Make sure that you manage it transparently and stay compliant with accounting standards. Companies that use cash basis accounting do not have deferred revenue. Deferred revenue applies to companies that use accrual basis accounting.

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FAQs Business Owners Need to Know About The 3 Essential Financial Reports

inDinero Accounting

If a business owner doesn’t understand an accounting term , we don’t use another accounting term to explain it. We specialize in accountants who speak business to business owners and CEOs. Sometimes there’s just no avoiding accounting speak. What is the indirect method of accounting for cash flow?