On November 1, 2016, Wenger Co. paid its landlord $4,140 in cash as an advance rent payment on its store location. The six-month lease period ends on April 30, 2017, at which time the contract may be renewed.

a. Prepare the horizontal model to record the six-month advance rent payment on November 1, 2016. (Use amounts with + for increases and amounts with – for decreases.)

b Prepare the journal entry to record the six-month advance rent payment on November 1, 2016. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

Journal Entry Worksheet

Record a six-month advance rent payment

c. Prepare the adjusting entry that will be made at the end of every month to show the amount of rent "used" during the month. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

Journal Entry Worksheet
d. Calculate the amount of prepaid rent that should be reported on the December 31, 2016, balance sheet with respect to this lease.

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