Assume that cash is paid for rent to cover the next year.The appropriate debit and credit are:

Question

Quizplus · Accepted Answer

When cash is paid for rent to cover the next year, it means that rent is being paid in advance. Therefore, the appropriate debit is to Prepaid Rent, which is an asset account that shows the amount of rent paid in advance. The credit should be made to Cash as cash is being paid to the landlord. Hence, the correct choice is C, debit Prepaid Rent and credit Cash.

Assume That Cash Is Paid for Rent to Cover the Next