Day: July 16, 2022

A company’s financial year ends on 31 December.

At 31 December Year 1 the company carried forward a debit balance of £36 200 on the Rent account.

During Year 2 payments made for 12 months’ rent, to 31 March Year 3, were £157 200.

What is the amount of rent to be charged against profit in the year ended 31 December Year 2?

Select ONE answer:

1. £121 000
2. £154 100
3. £160 200
4. £193 400

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 2

1. Not correct
2. Correct ==> £157,200 / 12 = £13,100 ==> Times 9 months for Year 2 portion = £117,900 ==> Add carried forward prepayment of £36,200 ==> £154,100
3. Not correct
4. Not correct

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