Prepaid rent, representing rent for the next six months' occupancy, would be reported on the tenant's balance sheet as a (n) a. liability b. asset c. contra liability and. stockholders' equity account

Question

Blake Mccall

Business

8 January, 09:03

Prepaid rent, representing rent for the next six months' occupancy, would be reported on the tenant's balance sheet as a (n) a. liability b. asset c. contra liability and. stockholders' equity account

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Tyrell Frazier · Answer 1

Asset

Explanation:

n asset is a resource that has some economic value. It could be a skill, capital, or property used to generate income or a benefit to a firm or an individual. Assets can be classified as current and long term assets.

Prepaid rent is an asset. It is the rent that has not been consumed. The tenant will use that prepaid rent to generate more income for the next six months. Prepaid rent is an advance payment, which implies that the landlord owes the tenant. Overdue rent or unpaid rent contrasts prepaid rent, and are a liability.