(basic)accounting help plz!
posted by Thara! .
June 1: Rented office space and paid three months’ rent in advance, $3,000,
Ans: Rent expense (DEBIT)
a) One month’s rent had expired.
i think it will be:
prepaid rent (DEBIT $2000)
rent payable (CREDIT $2000)
CAN U CHECK IF THESE ARE RIGHT PLZ! THNX
If you are studying accounting, the following tutorials may be of value to you:
The rent is only expensed when it used.
When you pay for rent in advance you are paying for prepaid rent.
Prepaid Rent, $3,000 Debit
Cash, $3,000 Credit
Adjustment Entry #1 at End of Month
Rent Expense (Debit 1/3th of $3,000)
Prepaid Expense (Credit the value above)
Hope I helped.
Hey!!! thnx zeeshan...this gave me the opportunity to edit my other entries similar to this...thnz ^_^