On May 1,San Jose Company paid $36,000 for rent.The rent covers the period May 1 through August 31.San Jose Company recorded Prepaid Rent of $36,000.What is the Rent Expense for the month of May?

Question

Quizplus · Accepted Answer

Since the rent of $36,000 covers the period from May 1 to August 31, the amount that will be allocated to the month of May is calculated as follows:
Rent expense for May = Total rent / Number of months covered by rent * Number of months in May
Rent expense for May = $36,000 / 4 * 1 = $9,000
Therefore, the Rent expense for the month of May is $9,000.

On May 1,San Jose Company Paid $36,000 for Rent