Deferred income

Accounting.

Income for which payment has been received by the business but which has not yet been earned.

Deferred income is recorded as a credit balance in the balance sheet.

(The related accounting entries being DEBIT Cash and CREDIT Deferred income.)

Deferred income is a liability of the reporting entity to provide the services that the customer has already paid for.

For reporting presentation purposes it is often aggregated with Accruals as 'Accruals and deferred income'.

See also

• Accrual
• Accruals accounting
• Accrued income
• Balance sheet
• Credit
• Debit
• Financial reporting
• Liabilities
• Prepayment
• Reporting entity
• Revenue