A restaurant owner prepares a balance sheet on the last day of each month. On January 1

Question:

A restaurant owner prepares a balance sheet on the last day of each month. On January 1^st. the owner pre-pays $24,000 for a one year liability insurance policy. What will be the balance in this pre-paid expense account on the last day of July?

a. $10,000

b. $12,000

c. $14,000

d. $24,000

Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial...