Hank's Tax Planning Service started business in January,2014.The company rented an office for $1,800 per month starting from January 1.On January 1,Hank prepaid the rentals through June 30.The company makes accrual adjustments monthly.What is the balance in the Prepaid Rent account as of April 30?
A)$3,600
B)$300
C)$1,800
D)$900

Question

Quizplus · Accepted Answer

Prepaid Rent = $1,800 x 6 months = $10,800. As of April 30, 4 months have passed, so the balance in the Prepaid Rent account is $10,800 - $1,800 x 4 = $3,600.

Hank's Tax Planning Service Started Business in January,2014