![]() ![]() Credits decrease these accounts and increase liability and equity accounts.Īfter the services are rendered, send an invoice to the customer. Debits increase expenses, assets such as cash or equipment, and dividend accounts. In your accounts, debit the cash account and credit the customer deposits account in the same amount. The detail for the earned or unearned revenue should be posted in that account. If this is a new client, create a customer account in the accounting records. Third, associate the advance payment to the correct customer account. You might think a customer deposit would be straight income, but since you "owe" the customer something, it's actually a liability to the business. Second, create your deferred revenue account.
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