Accrued Revenue
Income earned but not yet received or billed, recorded as an asset to recognize revenue when earned rather than when payment is received.
Accrued Revenue
Income that has been earned but not yet received or recorded, requiring an adjusting entry to recognize the asset and revenue in the appropriate period.
For instance, an attorney who has completed $8,000 worth of legal services for a client but hasn’t yet billed for them would record accrued revenue to recognize the earned income in the current period, even though payment will occur later.
Accrued revenue ensures that financial statements reflect all economic activity of the period, regardless of billing or payment timing. It appears as an asset (typically accrued receivables) on the balance sheet until the amount is invoiced and converted to accounts receivable or collected as cash.