A company paid next month's rent in advance.This would be classified as a(n):
A)current asset.
B)Expense.
C)Revenue.
D)current liability.

Name: A company paid next month's rent in advance.This would be classified as a(n): A)current asset. B)Expense. C)Revenue. D)current liability.
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Question

Quizplus · Accepted Answer

Prepaid rent is an asset because the company has already paid for the rent but the benefit (use of space) will be received in the future. It is classified as a current asset because it will be used up within one year.

A Company Paid Next Month's Rent in Advance