Cash received from a customer for unearned subscription revenue can initially be recorded as either an:; (revenue/expense) or an:. (liability/expense). No matter how an unearned revenue was initially recorded, after the adjusting entry, net income will be identical.

Revenue , Liability

Explanation:

Cash received from Customer for Unearned Subscription revenue is  : 'Advance Income' i.e received before being earned / being due. So , it is recorded as Advance (Unearned) Income (Revenue).

It is a Liability for the firm as cash has been received but the goods & services are yet to be delivered or rendered.

Net Income will remain identical after adjustment entry. Entry : Cash dr to Advance Income cr - at time of cash receipt , Advance Income dr to Income cr - at time of accrual due time settlement. Income net amount will remain same as Cash dr to Income in usual case