Hank's Tax Planning Service Started Business in January 2016

question 157

Multiple Choice

Hank's Tax Planning Service started business in January 2016.The company rented an office for $1,800 per month starting from January 1,2016.On that day,Hank prepaid the rent through June 30.The company makes adjusting entries at the end of each month.What is the balance in the Prepaid Rent account as of April 30,2016?

• A)$3,600
• B)$300
• C)$1,800
• D)$900

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Definitions:

Reformation

A legal remedy that adjusts the terms of a contract to reflect the true intent of the parties when there was a mistake or misrepresentation.

Lawful Instruction

A directive that is in accordance with the law and legal principles, usually given in a professional or contractual relationship.

Obedience

Compliance or adherence to instructions, commands, or laws.

Fiduciary

A person or entity entrusted to manage assets or interests of another with a duty to act in their best interest.