How to input Prepaid Rent into a trial balance, with the value already in the initial Rent Expense balance?

Question

I am working on Homework for an Accounting class, and I am stumped on how to properly input some information to the trial balance sheet.

According to the problem, I need to make the following adjustment: 
D) Included in the rent expenses of $30,000 is $1,200 that is prepaid

The Trial Balance sheet has $30,000 in the left Trial Balance column, labeled Rent Expenses.

According to the instruction, Net Income should be $37,902.

If I debit $1,200 from Rent Expenses and credit $1,200 to Prepaid Rent (which I labeled "d" on the spreadsheet), the Net Income is off by $1,200. Since this is the only input that is $1,200, I assume that the problem is with Rent Expense or Prepaid Rent.

Maybe I am overthinking it, but I am stumped on what I am doing wrong. Any advice would be appreciated.

anonymous · Accepted Answer

You adjusted correctly by reducing Rent Expense and increasing Prepaid Rent. However, for some reason the Prepaid Rent debit adjustment amount is showing up in the Income Statement columns. It should be a debit in the Balance Sheet columns.

If you take it out of the Income Statement debit column and put it in the Balance Sheet debit column, your net income number will be correct and the Balance Sheet debit column will correctly show a debit balance of $1200 in the Prepaid Rent account.

How to input Prepaid Rent into a trial balance, with the value already in the initial Rent Expense balance?

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