Question

If the prepaid rent account before adjustment at the end of the month has a debit balance of $2,800, representing a payment made on the first day of the month, and if the monthly rent was $700, the amount of prepaid rent that would appear on the balance sheet at the end of the month, after adjustment, is_________.

Answer 1

Answer:

$2,100

Explanation:

Data provided in the question

Prepaid rent account before adjustment at the end of the month = $2,800

And, the monthly rent is $700

So, the amount of prepaid rent after adjustment is

= Prepaid rent account before adjustment at the end of the month - the monthly rent

= $2,800 - $700

= $2,100

Basically we deduct the monthly rent from the prepaid rent balance before adjustment