On November 1, Duane paid $18,000 in advance for a year's rent. The November 30 adjusting entry for rent expense should include a:
A) debit Rent Expense, $18,000.
B) credit Prepaid Rent Expense, $18,000.
C) debit Rent Expense, $1,500.
D) credit Cash, $1,500.

Question

Quizplus · Accepted Answer

The correct adjusting entry for rent expense on November 30 for one month would be to debit Rent Expense for $1,500, which is the monthly portion of the annual rent ($18,000 / 12 months). This recognizes the expense for November.

On November 1, Duane Paid $18,000 in Advance for a Year's