Generally, the amount of prepaid expenses that will be used up within one year are reported on a company’s balance sheet as a current asset. As the amount expires, the current asset is reduced and the amount of the reduction is reported as an expense on the income statement. Example of...
Prepaid expenses represent expenses and appear on income statements.() 点击查看答案 第4题 Any expenses you may ___ will be chargeable to the company.A.incurB.occurC.catchD.spend Any expenses you may ___ will be chargeable to the company. A.incur ...
Accrued expenses payable: Accounts in businesses are classified depending on the reason the cash has been introduced in the business. Generally, cash flows include profits earned and losses accrued in the business during its operations. Answer and Explanation: ...
Costs that occurred but are not yet expensed on the income statement are typically referred to as deferred costs, deferred expenses, or prepaid expenses and are reported on the company’s balance sheet as current assets until they become an expense. Examples of Deferred Expenses Assume that a co...
Answer true or false: Deferred expense is an asset that results from the payment of cash before the expense is incurred. Prepaid expenses and unearned income accounts are assets. Is the statement true or false? Prepaid expense and earned income accounts are assets. True False At t...
2.Which of the following types of accounts have a normal credit balance?a.assets and liabilitiesb.liabilities and expensesc.revenues and liabilitiesd.capital and drawing3.The asset created by a business when it makes a sale on account is termeda.accounts payableb.prepaid expensec.unearned ...
The most common examples of prepaid expenses include rent, equipment paid for before use, salaries, taxes, utility bills, interest expenses, etc. These expenses mark payment for things that add value to a business over a period of time. These are recorded as an asset on the balance sheet ...
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·Treat the prepayment initially as an expense in the Income Statement: Debit: Expenses ( Income Statement)say $10,000 Credit: Bank/Cash $10,000 Being 100% take up of prepaid expenses as expenses in the Income Statement. Next , at the end of the accounting period, use the following adjus...
Prepaid expenses are payments for goods or services that will be received in the future. These expenses are not initially recorded on a company’sincome statementfor the period when the money changes hands. Instead, prepaid expenses are first recorded on the balance sheet as an asset. But, as...