The Law Firm prepays for advertising in the local newspaper. On January​ 1, the law firm paid for months of advertising. How much advertising expense should Law Firm record for the two months ending February 28 under the a. cash​ basis
b. accrual​ basis?

Answer and Explanation:

The computation of the advertising expense that should be record for the two month under following basis is

a. For cash basis

It should be recorded at $2,000

b. For accrual basis

= $2,000 ×2 ÷5

= $800

In this way, it should be determined

And, the same should be relevant

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