Which of the Following Statements Is Correct About Prepaid Expenses

Unearned revenue is increased with a debit. Debit Prepaid Rent 24000.

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Prepaid expenses is expenses paid in advance and recorded in previous period.

. In other words prepaid expenses are. Accrued expenses and accrued revenues involve assets and liabilities that have not yet been recorded. Debit Prepaid Insurance 55.

Prepaid expenses depreciation and unearned revenues involve previously recorded assets and liabilities. O Prepaid accounts are current expense accounts and are reported on the income statement. The correct adjusting entry on December 31 2016 is a.

Debit Prepaid Insurance 1800. Credit Insurance Expense 55 d. Accounts payable is increased with a credit.

Prepaid expenses are decreased with a debit. Accrued expenses is expenses accrued but not paid hence its a liabilityand its recorded by passing adjusting entries. Expenditures are recorded as prepaid.

Transcribed image text. Credit Prepaid Insurance 165. Debit Insurance Expense 495.

The initial payment will be. What are Prepaid Expenses. The adjusting entry required on December 31 is A.

Prepaid expenses is expenses paid in advance and recorded in previous period. Prepaid expenses are first recorded in the prepaid asset account on the balance sheet. Unearned Revenue is increased with a debit Salaries Payable is increased with a credit d.

Check all that apply Over the time the expired portion of the policy must be removed from the asset account as it has been used up and is no longer considered an asset. Unless the prepaid expense will not be incurred within 12 months it is recorded as a current asset. Credit Rent Expense 8000.

Prepaid expenses represent expenditures Expenditure An expenditure represents a payment with either cash or credit to purchase goods or services. All of these answers are correct. The Building account is an assetBlank 1Blank 1 asset Correct Unavailable assetliabilityexpense account and is reported on the left Blank 2Blank 2 left Correct Unavailable leftright side of.

Rent expense is increased with a credit. A prepaid expense is an amount paid in advance for the goods or benefits that are to be received in the upcoming period. Rent Expense is increased with a credit.

Credit Prepaid Rent 8000 B. The adjusted trial balance is prepared a. After adjusting entries have been journalized and posted b.

Debit Prepaid Insurance 1440. How will the company treat this initial payment and the subsequent expiration of a portion of the policy over time. Accrued expenses is expenses accrued but not paid hence its a liabilityand its recorded by passing adjusting entries.

Prepaid expenses depreciation and. Which of the following statements is correct. Debit Rent Expense 8000.

Debit Prepaid Insurance 360. Your business purchased office supplies of 2500 on account. When the asset is eventually consumed it is charged to expense.

Debit Insurance Expense 165. Accounts receivable are increaseddecreased by credit sales and are increaseddecreased by customer payments. Promises of future payment by the buyer are called accounts receivable.

When a future expense is paid in advance the payment is normally recorded in a liability account called Prepaid Expense. Prepaid expenses depreciation and unearned revenues involve previously recorded assets and liabilities. Which of the following statements is correct.

An expenditure is recorded at a single point in time that have not yet been recorded by a company as an expense but have been paid for in advance. Increases and decreases in cash are always recorded in the owners capital account. Adjusting entries are used to record both accrued expenses and accrued revenues.

Which of the following statements is correct. An annual insurance policy is paid in advance by a company. Prepaid Expenses are decreased with a debit b.

A prepaid expense is an expenditure paid for in one accounting period but for which the underlying asset will not be consumed until a future period. Accounts Payable is increased with a credit. Depreciation are used to record the wear and tear of an asset over the passage of time.

Hence all the answers mentioned above are correct. The advance payment is recorded as prepaid rent on the assets side. Which of the following statements is correct.

The expenses should be recorded when they are incurred as per the accrual accounting and therefore when the rent is paid in advance it would not be recorded as an expense of the company but as an asset of the company because the benefits are yet to be received for the amount paid. Credit Prepaid Insurance 660 b. O Prepaid accounts are also called prepaid expenses and are considered assets.

Unearned Revenue is increased with a debit. Which of the following statements is correct about prepaid accounts Prepaid accounts are also called prepaid expenses and are considered assets. If consumed over multiple periods there may be a series of corresponding charges to expense.

Which of the following statements is correct about prepaid accounts O Prepaid accounts are also called prepaid liabilities and are classified as liabilities. Depreciation are used to record the wear and tear of an asset over the passage of time. Prepaid Expenses are decreased with a debit.

Accrued expenses and accrued revenues involve assets and liabilities that have not yet been recorded. Prepaid expenses depreciation and unearned revenues require adjusting entries to record the effects of the passage of time. Which of the following statements is correct about prepaid accounts Prepaid accounts are also called prepaid expenses and are considered assets.

Credit Prepaid Insurance 495 c. Debit Insurance Expense 660. Rent Expense is increased with a credit 8.

The prepaymemt expense is primarily shown as a current asset in the balance sheet till its. The various prepayment expenses disbursed by a firm include paid off rent insurance interest salary utility bills and taxes. Up to 256 cash back If the purchase wasrecorded in the Prepaid Insurance account and the company recordsadjustments only at year-end the adjusting entry at the end of thefirst year is.

The balance in the prepaid rent account before adjustment at the end of the year is 32000 which represents four months rent paid on December 1.

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