Hank's Tax Planning Service started business in January, 2014. He rented an office for $1,800 a month starting January 1. On January 1, he prepaid the rentals through June 30. He makes accrual adjustments monthly. What is the balance in the Prepaid Rent account as of April 30?
A)$3,600
B)$300
C)$1,800
D)$900

Question

Quizplus · Accepted Answer

Hank prepaid rent for 6 months (January to June) at $1,800 per month, totaling $10,800. By April 30, four months of rent have been used (January to April), which is $7,200. The remaining balance in the Prepaid Rent account is $10,800 - $7,200 = $3,600.

Hank's Tax Planning Service Started Business in January, 2014