unearned income

Definitions (2)
Popular Terms
1. Accounting: Income received before a good is sold or a service is provided. Unearned income is classified as a current liability on the balance sheet until it is recognized as earned income during the accounting cycle.
2. Taxation: Income derived from means other than the provision of personal efforts, such as that derived as dividends, interest, or rent. Pensions and royalties, however, are not considered unearned income.

Use 'unearned income' in a Sentence

When trying to break down your current financial state you can count some unearned income to figure out your net worth.
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I wondered how we got money before the sale was complete and my manager told me about unearned income and how it worked.
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The unearned income was not realized in our reports so we had to contact the analyst to update our records.
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