31) When prepaid rent is recognized as an expense, which of the following is true? a) Prepaid rent decrease, rent expense on the income statement increases and equity increases b) Cash decreases and equity decreases c) Prepaid rent decrease, rent expense on the balance sheet increases and equity decreases d) Prepaid rent decrease, rent expense on the income statement increases and equity decreases e) None of the choices listed

32) Recognizing prepaid expense would cause equity to: a) increase b) decrease c) no effect d) not enough information e) None of the choices listed

33) Extreme Cruise Inc. prepaid $4,500 for 3 months rent on July 1, 2010. What would be the balance of the Prepaid Rent account on September 1, 2010? a) $4,500 b) $3,000 c) $1,500 d) $0 e) None of the choices listed