Mini Ltd paid Rent for the business for the next 9 months on 1 March 2022. The total payment amounted to $27,000.

On March 1, the Prepaid Rent account was debited, and the Cash at Bank account was credited.

Required

A.  Give the adjusting Journal entry at 30 June for year ending 30 June 2022.?

B.   What amount should be reported in the 30 June 2022 Balance Sheet for Prepaid Rent?

C.  If no adjusting entry was made on 30 June 2022, by how much would profit be overstated or understated? How much would assets be overstated or understated? Explain?

D. What would your adjusting entry in requirement (A) be if the payment of $18,000 was recorded by debiting Rent expense?

Answer rating: 100% (QA)

A De bit Prep aid Rent 9 000 Credit Rent Exp ense 9 000 B 18 000 C Profit would be over s... View the full answer