PRC-1 · Chapter 4 · Question 45 of 100
In the 'Rent Expense' ledger account of 'Vertex Ltd' (using the single account system), the opening balance brought down (b/d) is on the credit side. What does this opening balance specifically represent?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: B) Accrued rent from the previous period.
Explanation
In an expense account, an opening credit balance signifies an amount owed (a liability) from the previous period, which is an accrued expense.
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