When a Prepaid Expense Is Initially Recorded as an Expense

question 142

Multiple Choice

When a prepaid expense is initially recorded as an expense, the adjusting entry would include a:

• A)debit to a contra account.
• B)debit to a prepaid expense account.
• C)debit to an unearned expense account.
• D)debit to an unearned revenue account.

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Definitions:

Neolithic

The New Stone Age; a prehistoric period beginning about 10,000 years ago in which peoples possessed stone-based technologies and depended on domesticated crops and/or animals for subsistence.

Division of Labor

The allocation of different tasks and responsibilities to different individuals or groups, typically to increase efficiency in production or services.

Diffusion

The spread of certain ideas, customs, or practices from one culture to another.

Ideas

Mental representations or thoughts that arise in the mind, ranging from concepts, plans, opinions, to creative innovations.