Hackett Company's prepaid rent was $12,000 at December 31 Year 1 and $15,000 at December 31,Year 2.Hackett reported rent expense of $45,000 on its Year 2 income statement.What would be reported as cash paid for rent on the statement of cash flows?

Question

Quizplus · Accepted Answer

The cash paid for rent would be the difference between the prepaid rent at the beginning and end of the year, plus rent expense incurred during the year. Therefore, cash paid for rent would be ($15,000 - $12,000) + $45,000 = $48,000, which is option C.

Hackett Company's Prepaid Rent Was $12,000 at December 31 Year