The balance in the Prepaid Rent account before adjustment at the end of the year is $12,000, which represents 12 months rent paid on November 1. The adjusting entry required on December 31 to show the amount of rent that had expired is:

Multiple Choice $12,000 Prepaid Rent ........... Rent Expense. $12,000 Rent Expense........ Cash.. $12,000 $12,000 Rent Expense..... Prepaid Rent......... $2,000 $2,000 $1,000 Rent Expense........... Prepaid Rent.... $1,000