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MMLU / On October 31, year 1, a company with a calendar year-end paid …

Problem

Answer published by the source. Consult the official source to check your work against its answer.

question

On October 31, year 1, a company with a calendar year-end paid 90,000forservicesthatwillbeperformedevenlyoverasixmonthperiodfromNovember1,year1,throughApril30,year2.Thecompanyexpensedthe90,000 for services that will be performed evenly over a sixmonth period from November 1, year 1, through April 30, year 2. The company expensed the 90,000 cash payment in October, year 1, to its services expense general ledger account. The company did not record any additional journal entries in year 1 related to the payment. What is the adjusting journal entry that the company should record to properly report the prepayment in its year 1 financial statements?
Plain-text mathematical notation (without MathML)
On October 31, year 1, a company with a calendar year-end paid 90,000forservicesthatwillbeperformedevenlyoverasixmonthperiodfromNovember1,year1,throughApril30,year2.Thecompanyexpensedthe90,000 cash payment in October, year 1, to its services expense general ledger account. The company did not record any additional journal entries in year 1 related to the payment. What is the adjusting journal entry that the company should record to properly report the prepayment in its year 1 financial statements?
Original LaTeX notation
On October 31, year 1, a company with a calendar year-end paid $90,000 for services that will be performed evenly over a sixmonth period from November 1, year 1, through April 30, year 2. The company expensed the $90,000 cash payment in October, year 1, to its services expense general ledger account. The company did not record any additional journal entries in year 1 related to the payment. What is the adjusting journal entry that the company should record to properly report the prepayment in its year 1 financial statements?

choices

  1. Debit prepaid services and credit services expense for $30,000.
  2. Debit prepaid services and credit services expense for $60,000.
  3. Debit services expense and credit prepaid services for $30,000.
  4. Debit services expense and credit prepaid services for $60,000.

subject

professional_accounting

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Source and history

task_id
b54123ae-72e0-5477-b044-93ab0e614226
task_key
all--test--b54123ae-72e0-5477-b044-93ab0e614226
task_revision_id
1
config / split
all / test

Official source

initial import