On the 1st January a company pays in cash $24,000 for the rent for the full year. On January 31st you want to recognise the cost of one months rent on your income statement. 1. Which account would you debit on 1st January? 2. Which account would you credit on 1st January? 3. What is the effect on owners equity on January 1st? 4. On January 31st you want to recognise the cost of one months rent, so which account would you debit? 5. Which account would you credit? 6. How much would you credit/debit those accounts in questions 5 and 6? 7. How much would owners equity increase or decrease on January 31st? 8. What would be the balance of your rent in advance account on June 30th