Final answer:
In a statement of adjustments, rent is accounted for by allocating the paid or owed amounts between the buyer and seller according to who owns or controls the property during the rent period.
Step-by-step explanation:
The statement of adjustments is primarily used in real estate transactions to allocate costs between the buyer and seller. In this statement, rent is accounted for by adjusting the amount owed by either party based on the rent period that has been paid for but not yet used or the period that has been used but not yet paid for. For example, if a seller has collected rent in advance for a period that extends beyond the sale date, the seller owes the buyer a portion of this rent. Conversely, if the rent is in arrears, the buyer might owe the seller for the period they will occupy the property but for which the seller has not been paid.This adjustment ensures that each party only pays for the expenses they are responsible for during the time they own or control the property. This is critical in ensuring the transaction is fair and equitable to both the buyer and seller.