Question

Select the most appropriate alternatives from those given below

Pre-received income is shown on _________ side Balance sheet
a) Assets
b) Liabilities
c) credit
d) debit

Answer 1

Pre-received income is shown on the Liabilities side of Balance sheet.

Explanation:
Pre-received income means the unearned income that is received in the current year but belongs to the next year. Thus, such income becomes the liability of a business until it accrues to the business. Thus, it will be deducted from the concerned income on the credit side of the Profit & Loss Account and will be shown on the Liabilities side of the Balance Sheet.