All of the Following Are True Regarding Prepaid Expenses Except

question 76

Multiple Choice

All of the following are true regarding prepaid expenses except:

• A) They are paid for in advance of receiving their benefits.
• B) When they are used, their costs become expenses.
• C) They are assets.
• D) The adjusting entry for prepaid expenses increases expenses and decreases liabilities.
• E) The adjusting entry for prepaid expenses increases expenses and decreases assets.

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Definitions:

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An American socialist, political activist, and trade unionist, known for his role in founding the Industrial Workers of the World and for running unsuccessfully for U.S. president five times as a candidate of the Socialist Party.

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