O-LevelAccountingAccounting procedures7707/12 · Oct/Nov 2021 · Q41 Mark

During her first financial year, a trader paid $1800 for insurance and $3200 for rent. At the end of the financial year, she transferred insurance of $1500 and rent of $3600 to the income statement. What do the balances remaining on the accounts at the end of the financial year represent? [Figure showing table with insurance account and rent account columns]

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Aaccrued expense accrued expense

Baccrued expense prepaid expense

Cprepaid expense accrued expense

Dprepaid expense prepaid expense

✓ Correct answer

C: prepaid expense accrued expense

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Topic: Accounting procedures, O-Level Accounting (syllabus 7707). Multiple choice, 1 mark.
Source: O-Level Accounting, Oct/Nov 2021 Paper 1 Variant 2, question 4.

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