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gOOvER gOOvER
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6 years ago
On September 1, 2014, Two Sisters Company pays $36,000 cash for six months rent. The balance in prepaid rent on December 31, 2014, after adjustment, would be:
A) $6,000.
B) $24,000.
C) $12,000.
D) $0.
Textbook 
Accounting, Volume 1, Canadian Edition

Accounting, Volume 1, Canadian Edition


Edition: 9th
Authors:
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HanoiHanoi
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#1
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6 years ago Edited: 4 months ago, bio_man
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More solutions for this book are available here
C

Prepaid rent for 6 months =$36,000

rent expense for one month =36,000/6 = $6,000

months passed til 31st December = 4

Rent expense till 31st December = 4 x 6,000 =$24,000

Balance in prepaid rent after adjustment for rent expense =36,000 - 24,000 = $12,000
1

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Help! The answer is missing an explanation...
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Quote from: Anonymous (4 months ago)
Help! The answer is missing an explanation...

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