What is accrued revenue?


Accrued Revenue

Sometimes a business may provide goods and services during a period that are neither billed nor settled by the end of that period.  However, the value of such goods and services is earned during the period and the accounts should reflect such accrued revenues.  A common example is that of placing some amount of money with a bank in a fixed deposit account.  Interest is received only on expiry of the term although it accrues on a time basis.  At the end of the accounting period, the account should reflect interest earned whether received or not.  Any portion of interest earned but not yet received will appear as an asset in the balance sheet.

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