Journal entries to account for payments in advance James has extracted a trial balance from his books of account at 31 December 2014 that includes the following entries.

You are told that the property rental shown in the trial balance is for a period of 14 months, so two months are paid in advance. Included in the hotel expenses is an amount of $400 that relates to expenses for the following accounting period. Required Detail the journal entries to include these amounts in the financial statements.

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Dr ($) Cr ($) Property rental 2 000 Hotel expenses 3 550