Question

On January 1 of the current​ year, Belle Company paid $ 1 comma 200 in rent to cover six months ​(Januarylong dash​June). Belle recorded this transaction as​ follows: LOADING...​(Click the icon to view the journal​ entry.) Belle adjusts the accounts at the end of each month. Based on these​ facts, the adjusting entry at the end of January should include

Answer 1

rent expense 200 debit

prepaid rent 200 credit

--to record expired rent--

Step-by-step explanation:

Timeline:

<-----//-------//---------------------->

Jan 1st Jan31th

The amount paid is for six month of rent. So, 1,200 is the value of six month.

So each month is worth 1,200 / 6 = 200

Ad the end of the month we will reduce the prepaid and recognize the rent expense for January