Question

Prepaid expenses require what type of adjusting entry? Question options: Matched Accumulated Accrued Deferral

Answer 1

deferral

Step-by-step explanation:

Adjusting entries are when changes are made to already recorded journal entries.

Categories of adjusting entries :

1. accrued revenues
2. accrued expenses
3. unearned revenues
4. prepaid expenses
5. depreciation.

Prepaid expenses are payments made for services yet to be delivered.

For example, paying for a year's worth of subscription on your streaming service

Prepaid expenses is an example of deferred payment, so the adjustment should be a deferral