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Option B is the right answer.
B) $250 AS THE QUESTION SAYS $1000 IS FOR WHOLE YEAR UP TO31ST MARCH09 AND PREPAYMENT AS AT31ST DECEMBER08 WOULD BE FOR3MTHS.
THEREFORE =1000*3/12= $250
Prepaid as on31st December is $250...
Rent advance250-----------------------
D. $200. The total number of months will be15 thus12 months for2008 and3 months within2009. To obtain amount per month = total paayment / number of months; this implies $1,000/15 = $66.67.
If the business prepares account to31/12/2008 then3months prepayment has been maade hence $66.67 x3months = $199.99 aproximately $200
The prepaid Expenses = (/ )×3=$
The answer is B
B. $...............
..............
Option B is the answer. Prepayment as on st December is (\\)*3 which is $.