Prepaid expenses require an adjustment to be made to the double entry accounts as follows: (a) Credit
Question:
Prepaid expenses require an adjustment to be made to the double entry accounts as follows:
(a) Credit relevant expense account with prepayment before balancing off account; debit prepayment to same account after balancing off.
(b) Debit relevant expense account with prepayment before balancing off account; credit prepayment to same account after balancing off.
(c) Credit relevant expense account with prepayment before balancing off account; debit profit and loss account.
(d) Debit relevant expense account with prepayment before balancing off account; credit profit and loss account.
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The correct option is b Debit relevant expense account with prepayment before balancing off acc...View the full answer
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Related Book For 
Financial Accounting For Management
ISBN: 9789385965661
4th Edition
Authors: Neelakantan Ramachandran, Ram Kumar Kakani
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