In vertical analysis of the income statement, we usually express each income statement item as a percentage of: sales.
<h3>What is income statement?</h3>
Income statement can be defined as the statement that help to show the income and expense of a company in which when the income is higher than the expense it is net income and when the expense is higher than the income it is net loss.
In vertical analysis of the income statement the income statement item is often express as a percentage of sale.
Therefore the correct option is D.
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Answer:
rent expense 200 debit
prepaid rent 200 credit
--to record expired rent--
Explanation:
Timeline:
<-----//-------//---------------------->
Jan 1st Jan31th
The amount paid is for six month of rent. So, 1,200 is the value of six month.
So each month is worth 1,200 / 6 = 200
Ad the end of the month we will reduce the prepaid and recognize the rent expense for January