knowledge check 01 a company is in its first month of operations. on january 1, the company pays 3 months of…

knowledge check 01 a company is in its first month of operations. on january 1, the company pays 3 months of rent in advance for $2,100. what adjusting entry would be made at the end of january? post the adjusting entry for the scenario provided. note: if no entry is required for a transaction/event, select \no journal entry required\ in the first account field. view transaction list journal entry worksheet 1 record the adjusting entry for rent used during the month of january. note: enter debits before credits. date general journal debit credit january 31

knowledge check 01 a company is in its first month of operations. on january 1, the company pays 3 months of rent in advance for $2,100. what adjusting entry would be made at the end of january? post the adjusting entry for the scenario provided. note: if no entry is required for a transaction/event, select \no journal entry required\ in the first account field. view transaction list journal entry worksheet 1 record the adjusting entry for rent used during the month of january. note: enter debits before credits. date general journal debit credit january 31

Answer

Explanation:

Step1: Calculate monthly rent expense

The company paid $2,100 for 3 - month rent in advance. So the monthly rent expense is $\frac{2100}{3}=700$.

Step2: Determine the adjusting - entry accounts

The prepaid rent (an asset) is being used up, so we need to decrease the prepaid rent (credit) and record the rent expense (debit).

Answer:

Date General Journal Debit Credit
January 31 Rent Expense 700
January 31 Prepaid Rent 700