Deferred Credit

Deferred Credit
Income that is received by a business but not immediately reported as income. Typically, this is done on income that is not fully earned and, consequently, has yet to be matched with a related expense. Such items include consulting fees, subscription fees and any other revenue stream that is intricately tied to future promises. For example, a book club might defer income from a two-year membership plan until all the costs of procurement and shipping are assessed. Also known as deferred revenue or deferred income.

Deferred credit is used largely for bookkeeping purposes and as a means to even out, or "smooth" financial records and give a more accurate picture of business activities. Using the previous example of a book club, if all membership or subscriptions fees just happened to come in during the first quarter and all products were shipped out in the second, the quarter-to-quarter income statement would obviously be skewed.


Investment dictionary. . 2012.

Игры ⚽ Поможем написать реферат

Look at other dictionaries:

  • deferred credit — UK US noun [C] (also deferred income [U], also deferred revenue [U]) ► ACCOUNTING money that has been received by a business but has not yet been shown in the accounts as income, for example, payment in advance for goods that have not yet been… …   Financial and business terms

  • deferred credit — deferred income; = deferred liability Income received or recorded before it is earned, under the accruals concept. The income will not be included in the profit and loss account of the period but will be carried forward on the balance sheet until …   Accounting dictionary

  • deferred credit — deferred liability Income received or recorded before it is earned, under the accruals concept The income will not be included in the profit and loss account of the period but will be carried forward on the balance sheet until it is matched with… …   Big dictionary of business and management

  • deferred credit — noun or deferred income or deferred liability : income received but not yet earned * * * deferred credit noun (bookkeeping) An item on a balance sheet denoting a value that will flow into a future period s profit and loss account instead of the… …   Useful english dictionary

  • deferred income — ➔ income * * * deferred income UK US noun [U] ► ACCOUNTING DEFERRED CREDIT(Cf. ↑deferred credit) …   Financial and business terms

  • credit transactions — In the context of directors loans a hire purchase or conditional sale agreement, a lease or hire agreement or the supply of goods or services on deferred credit terms (Section 330 344 Companies Act 1985). Easyform Glossary of Law Terms. UK law… …   Law dictionary

  • credit — an entry made on the right hand side of an account and indicating a gain to a liability, owner s equity or revenue account. Glossary of Business Terms money loaned. Bloomberg Financial Dictionary * * * ▪ I. credit cred‧it 1 [ˈkredt] noun 1.… …   Financial and business terms

  • Credit — Money loaned. The New York Times Financial Glossary * * * ▪ I. credit cred‧it 1 [ˈkredt] noun 1. [uncountable] COMMERCE an arrangement with a shop, supplier etc to buy something now and pay for it later: • They are saving for new furniture… …   Financial and business terms

  • deferred income — See: deferred credit …   Accounting dictionary

  • deferred liability — See: deferred credit …   Accounting dictionary

Share the article and excerpts

Direct link
… Do a right-click on the link above
and select “Copy Link”