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What Is FALSE Regarding Prepaid Items

Question 19

Multiple Choice

What is FALSE regarding prepaid items?


A) Prepaid adjustments typically decrease an expense and increase an asset.
B) Prepaids are items relating to expenses that have been paid in advance.
C) Adjusting entries for prepaids affect an Expense account and an Asset account.
D) The adjusting entry records the amount that needs to be transferred between two accounts,an expense and an asset,to show the amount of the asset that has been reduced or used.

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