Antel is a tenet of Baber.On July 1,Antel paid Baber $1,200 for 3 months of rent.On July 31,Antel's adjusting entries will include one with a debit to:

Question

Quizplus · Accepted Answer

The adjusting entry at the end of July will reduce the balance of the Prepaid Rent account by the amount of rent that has been used up during the month (1/3 of $1,200 = $400). Therefore, the correct entry is to debit Rent Expense for $400 (to recognize the portion of the rent that has been used up) and to credit Prepaid Rent for $400 (to reduce the balance of the prepaid account). The remaining balance in the Prepaid Rent account will be $800 ($1,200 - $400) after the adjustment is made.

Antel Is a Tenet of Baber