Prepaid Rent

Prepaid rent is an expense which has been paid in advance.

A business has an annual office rent of 12,000 and pays the landlord 3 months in advance on the first day of each quarter. On the 1 April it pays the next quarters rent in advance of 3,000 to cover the months of April, May and June It has a prepaid expense of 3,000.

Prepaid Rent November 6th, 2016Team
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Prepaid Expenses

Prepaid expenses are costs paid by a business which have not been fully utilized during one accounting period; they overlap accounting periods. Prepaid accounting arises from the matching concept, one of the fundamental accounting principles.

prepaid accounting

Prepaid Expenses November 6th, 2016Team
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Prepaid Expense

A prepaid expense is an expense which has been paid in advance.

A business has an annual premises rent of 60,000 and pays the landlord quarterly in advance on the first day of each quarter. On the 1 January it pays the next quarter rent of 15,000 to cover the 3 months of January, February, and March. It has a prepaid expense of 15,000.

Prepaid Expense January 31st, 2017Team
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