On July 1 the Don Harry Gallery Paid $4,000 to Fairy

Multiple Choice

On July 1 the Don Harry Gallery paid $4,000 to Fairy Realty for 4 months rent beginning July 1. Prepaid Rent was debited for the full amount. If financial statements are prepared on August 31, the adjusting entry to be made by the Don Harry is

A) debit Rent Expense, $3,000; credit Prepaid Rent, $1,000.
B) debit Prepaid Rent, $2,000; credit Rent Expense, $2,000.
C) debit Rent Expense, $1,000; credit Prepaid Rent, $3,000.
D) debit Rent Expense, $2,000; credit Prepaid Rent, $2,000.