When a Tenant Makes an End-Of-Period Adjusting Entry Credit to the "Prepaid

question 83

Multiple Choice

When a tenant makes an end-of-period adjusting entry credit to the "Prepaid rent" account:

• A) (S)he usually debits cash.
• B) (S)he usually debits an expense account.
• C) (S)he debits a liability account.
• D) (S)he credits an owners' equity account.

---

Definitions:

Implied Warranty

A guarantee that is not written or spoken but is understood and legally binding, ensuring goods or services meet certain standards of quality and reliability.

Implied Warranty

A legal presumption that a product will fulfill the basic functions for which it was sold, without being explicitly stated by the seller.

Merchantability

Concerns the basic standard of quality and functionality that goods sold must meet, implying they are fit for the general purpose for which they are sold.

Fitness

A state of health and well-being, often focused on the ability to perform physical activities or meet specific physical criteria.