Accounting: will this go under net worth or liabilties?
I am gonna do the 1st one for you (cos they gave it to me)
1. Effeect - +17500 (bank) Reason: bank increase Equipment - N/A - Liabilities N/A - Net worth +17500 (bank decrese)
2. Paid rent to Bruma properties now where will this go I know it will go into bank, but what else?
- KrudKutterLv 68 years agoFavorite Answer
Rent is a fixed overhead item. Has nothing to do with assets (what you own) or liabilities (what you owe) or the difference between the two (Net Worth).
In GAAP (Generally Accepted Accounting Practices) a payment for rent would normally DEBIT (decrease) a cash or other bank account and CREDIT (increase) a G&A Expense (General and Administrative expense) account. Hope this helpsSource(s): Been in business for 35+ yrs.