Answer Happy

88 SOLID FOOTING Chapter 7 - Adjusting Entries Problem 7-4 Paying Rent in Advance and the Monthly Prepaid Rent Adjusting Entry On June 20, 2021, Amy Smith, owner of Amy's Floral Shop, Inc., signed a contract to rent a retail store. As part of the contract, Amy paid four months of rent in advance. The rental rate is $3,000 per month, thus she paid $12,000 cash in advance when she signed the contract on June 20. Amy will move into the retail store on July 1, 2021, which is the start of her rental period. The company has the accounting policy that all prepaid assets are initially recorded in asset accounts. The following is a partial list of the accounts in Amy's General Ledger. These are the only accounts you need for this problem. Cash > Prepaid Rent (asset account) D Rent Expense Use the forms on Tabs Z4 A and Z4 B in the Excel workbook Chapter 07 C- Problem 7-1 to 7-8 Forms to complete this problem. Requirement 1 Prepare the General Journal entry to record the $12,000 payment made when the rental contract was signed on June 20, 2021.
Problem 7-4 Paying Rent in Advance and the Monthly Prepaid Rent Adjusting Entry Pg. A Requirement 1 - June 20 advance payment of rent Date Account Name Debit Credit