Question

What is the difference between the accounts Rent Earned, Rent Revenue, and Earned Rent . Answer should be More than 300 word . under length answer would not acceptable  

Answer 1

Answer

“The income derived from the ownership of land and other free gifts of nature is commodity called “Rent” in economics.

On the basis of the definitions written above it can be said that land contains original and indestructible powers and for that the landlord receives some remuneration which is called Rent. But modern economists are of this opinion that rent is not confined to land and other free gifts of nature alone but to all factors of production, when they are in inelastic supply. When any factor is in less than perfectly elastic supply, it yields a surplus amount of that surplus the Rent is paid.

Rent Revenue

Rent Revenue is the title of an income statement account which (under the accrual basis of accounting) indicates the amount of rent that has been earned during the period of time indicated in the heading of the income statement.

The account Rent Revenue is also known as Rental Income.

Rent Earned

Rent income refers to revenue earned from leasing out properties, such as commercial spaces, to third parties.

If the company's income statement presents "Income from Operations" and "Other Income" separately, the accountant must know if renting out properties is part of the normal operations of the business or not to be able to know where to include Rent Income.

Advanced payments made by the lessee should not be part of Rent Income. Rather, advances should be recorded as liabilities (under Unearned Rent Income or Advances from Lessee). It is recorded as income only when the rental service is completed, i.e. the rental period has lapsed.

Cash deposit received from the lessee also does not constitute rent income. They are liabilities since the amount is normally refundable at the end of the contract.

Earned Rent

Earned Rent refer to the rent income which you have to earn this is not what you have earned in past but which you have to earn in future for example Rent Receivable.

Earned Rent / Rent Receivable is the title of Balance Sheet asset account.

Practically their is no such difference except rentr receivable and rent revenue.