Prepaid expenses have a not yet been recorded as expenses b

Prepaid expenses have a not yet been recorded as expenses b. been incurred and paid c been recorded as expenses and paid d. not yet been recorded as expenses but have been paid

Solution

option d) is the correct answer

not yet been recorded as an expense but have been paid.

Prepaid expense is expense paid in advance but which has not yet been incurred.For example insurance paid for 2 years will be recorded as prepaid expense.At the year end the expense for 1 year is incurred and hence the same will be recorded as an expense .

option d) is the correct answer not yet been recorded as an expense but have been paid. Prepaid expense is expense paid in advance but which has not yet been incurred.For example insurance paid for 2 years will be recorded as prepaid expense.At the year end the expense for 1 year is incurred and hence the same will be recorded as an expense .