FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Prepayments and T-Accounts (While providing me the answers to the questions below please accompany the answer with an explanation as to how you arrived at the answer. That is the only thing that will help me learn and understand this process)
Ajax Corporation leased a building for one year on April 1 for $18,000. The company paid for the entire year on April 1. Ajax's bookkeeper made the following entry on April 1.
Rent Expense $1,500 DR
Prepaid Rent $16,500 DR
Cash $18,00 CR
Assume it is now 12/31. Ajax has not made any
a) Calculate the adjusted ending balance in the Prepaid Rent account and the Rent Expense account at 12/31
b) Prepare a T-Account for Prepaid Rent and Rent Expense. Showing April 1 transaction, the adjustment to be made at 12/31, and the ending balances in Prepaid Rent and Rent Expense
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