Question

a business has paid the rent for the period jan-march 2016 in june 2016 , in which year financial statement this rent expenses will be recorded
a) 2015
b) 2016
c) 2017
d) all of the above

Answer 1

The correct answer is option b) 2016.

 

This is because; the current accounting period for that company is the year of 2016.

 

Thus, the outstanding expenses cleared in a particular year would be recorded in that year only. However, if it was cleared in the next year, then it would have been recorded under next year’s financial statements.