What will be a journal entry of prepaid rent?

Question

What will be a journal entry of prepaid rent?

Answer 1

Let's say you paid $6,000 for the next 2 months' rent. When you paid, you

Dr  Prepaid rent $6,000

Cr  Cash $6,000

At the end of the first month, you

Dr  Rent expense $3,000

Cr  Prepaid rent $3,000

and you do the same at the end of the 2nd month, after which the balance in your prepaid rent account would be zero.

Answer 2

Credit Bank and debit Pre Paid Rent

When making payments money is going out of the bank account hence this is a credit entry ( reducing the balance there). Remember Prepaid Rent is an expense, and expenses are Debit entries.

Answer 3

Prepaid Expenses (Rent) A/c. Dr, Cash (or Bank, as the case may be) A/c. Cr.  

Answer 4

You debit the account pre paid rent (or pre paid expenses) then credit the rent account.  When paid you do the reverse