when an adjustment is made for prepaid rent:\na. one asset increases and another decreases.\nb. an asset…
when an adjustment is made for prepaid rent:\na. one asset increases and another decreases.\nb. an asset decreases and an expense increases.\nc. an asset increases and an expense decreases.\nd. a liability decreases and an expense decreases.
Answer
Brief Explanations:
Prepaid rent is an asset. When the rent period elapses, the prepaid rent (asset) decreases as it is recognized as rent expense (expense increases).
Answer:
B. an asset decreases and an expense increases.