Distinguish between accrued and unearned incomes?

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answered Jun 20, 2022 by AnweshaGhosh (45.0k points)
selected Jun 21, 2022 by ChinmaySonje

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Difference between Accrued and Unearned Income:

Accrued Income	Unearned Income
1. The income which is earned by the businessman before the date of preparation of Final Account but not received is called Accrued Income.	1. The income which is not earned by the businessman before the date of preparation of Final Accounts but is received before such date is called unearned income.
2. This income is shown at the credit side of profit and loss account by adding it to the concerned head of income.	2. This income is also shown at the credit side of profit and loss account but by deducting it from the concerned head of income.
3. This income is shown on the Assets side of the Balance Sheet.	3. This income is shown on the Liabilities side of the Balance Sheet.