Question

Prepaid expenses are shown on the asset side of the Balance Sheet. (State True or False)

Answer 1

Hello!

Prepaid expense is shown on the Assets side of the business because it is an assets for the business .

Answer 2

The statement- Prepaid expenses are shown on the asset side of the Balance Sheet is true.

* It is considered to be a current asset till the time it is being used up.

* It is because it provides several benefits to the company in due course of time.

* Once the amount expires, it gets reduced and this amount gets recorded as an expense.