GREY:LGLTF - Post by User
Comment by
1nv35t0ron Jun 10, 2015 11:34am
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Post# 23815773
RE:Is that the last of the bozos?
RE:Is that the last of the bozos?Just to clairify Big Papi, Deferred revenue is when Loyalist has received cash up front, but has not yet provided the service. The adjusting journal entry, as the service is provided, is to debit(reduce) Deferred rev and Credit (increase) revenue. There is no cash added as it has already been received and booked, the intial entry is Debit(increase) Cash credit (increase) def rev. Considering the low cash balance, this is concerning since Loy has already received the cash, but has not yet paid for the related expenses.
Remember in Accrual accounting we match revenue with expenses, not with cash.