On September 1 the Petite-Sizes Store paid $15,000 to the Mega-Mall Co. for 3 months' rent beginning September 1. Prepaid Rent was debited for the payment. If Petite-Sizes Store prepares financial statements on September 30, the appropriate adjusting journal entry to make on September 30 would be a
A) $10,000 debit to Prepaid Rent and a $10,000 credit to Rent Expense.
B) No adjusting entry is necessary.
C) $5,000 debit to Prepaid Rent and a $5,000 credit to Rent Expense.
D) $5,000 debit to Rent Expense and a $5,000 credit to Prepaid Rent.
E) $10,000 debit to Rent Expense and a $10,000 credit to Prepaid Rent.
Ans: D) $5,000 debit to Rent Expense and a $5,000 credit to Prepaid Rent.
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