Question

If the prepaid rent account before adjustment at the end of the month has a debit balance of $2,800, representing a payment made on the first day of the month, and if the monthly rent was $700, the amount of prepaid rent that would appear on the balance sheet at the end of the month, after adjustment, is

Answer 1

$2,100

Step-by-step explanation:

The amount that will appear in the balance sheet after the adjustment of the rent expense of the $700 during the month is given as follow:

Amount of prepaid rent on balance sheet at the end of month=Debit balance of prepaid rent-monthly rent expense for the month

Amount of prepaid rent on balance sheet at the end of month=$2,800-$700

=$2,100