An Asset Created by Prepayment of an Expense Is

question 78

Multiple Choice

An asset created by prepayment of an expense is:

• A) Recorded as a debit to an unearned revenue account.
• B) Recorded as a debit to a prepaid expense account.
• C) Recorded as a credit to an unearned revenue account.
• D) Recorded as a credit to a prepaid expense account.
• E) Not recorded in the accounting records until the earnings process is complete.

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Definitions:

Unlearned Reaction

A natural, instinctive response to a stimulus that occurs without the need for prior learning or experience.

Reflexive Reaction

An automatic, involuntary response to a stimulus.

Unconditioned Stimulus

In classical conditioning, a stimulus that naturally and automatically triggers a response without any learning needed.

Conditioned Stimulus

A previously neutral stimulus that, after association with an unconditioned stimulus, comes to trigger a conditioned response.