Quiz 36 – Prepaid Expenses – (Answers)

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  • Name – Quiz 36 – Prepaid Expenses – (Answers)
  • Topic – Prepaid Expenses
  • Answers with Explanation


Q1. Prepaid Expenses are _____.

Ans. Prepaid expenses are current assets.


Q2. Credit Card Due = 10,000, Paid on Credit Card = 13,000, Prepaid Expense = _____.

Ans. Prepaid expense = 13,000 – 10,000 = 3,000 Rs.


Q3. _____ is an example of prepaid expense.

Ans. Prepaid rent is an unexpired (prepaid) expense. This is only applicable to operating expenses & not capital expenses.


Q4. ‘Prepaid Expense A/C’ is _____ to record the journal entry for prepaid expenses.

Ans. Debit – Prepaid Expense A/C & Credit – Expense A/C, for e.g. Debit – Prepaid Rent A/C & Credit – Rent A/C


Q5. Prepaid expense is a _____ account.

Ans. Prepaid (unexpired) expense is a personal account and is shown on the assets side of a balance sheet.


Q6. Prepaid expenses are also called _____ expenses.

Ans. Such expenses are also known as unexpired expenses or expenses paid in advance.


Q7. Prepaid expenses are treated as _____.

Ans. Prepaid expenses are treated as an asset for the business.


Q8. The benefits related to prepaid expenses are received _____.

Ans. The benefits of expenses paid in advance are received in the future accounting period.


Q9. Prepaid expenses are shown in _____.

Ans. Prepaid expenses are shown on the asset side of a balance sheet.


Q10. Prepaid expenses are _____.

Ans. Prepaid expenses are those expenses which have been paid in advance, however, the benefits are not received within the same accounting year.



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