Smith signed a contract with a service provider for security services at a rate of $250 per month for the period of January through June.He will pay the service provider the entire amount at the end of June.Smith makes adjusting entries each month.During the month of February,Smith will record total security expense of $500.

Question

Quizplus · Accepted Answer

Smith will record a security expense of $250 for February, as the expense is recognized monthly, not cumulatively, in each month's adjusting entry.

Smith Signed a Contract with a Service Provider for Security