Prepaid expenses would you consider that a balance sheet or income statement, I say balance but still confused a little.

Nora31

I think Prepaid expense would go to income statement

Yep, teon is right

They're both wrong.

Prepaid expenses are an asset. The fact that the word expenses is on there is not making them an expense. They were prepaid, meaning they were paid in advance. So the expense has not actually occurred yet. Hence, no expense exists and therefore cannot be on the income statement.

If something is paid in advance, you still have something coming to you which has value. A common example is insurance. If you pay six months in advance, you still have six months of coverage coming to you, which has a value in running your company. As each month goes by, that month is now gone and is no longer prepaid. It becomes an expense at that point, but as long as it still says "prepaid" on it, it's an asset.

I am sorry I'm a little rusty. Prepaid expenses do go on the balance sheet, but once they are used the benefit that you derive from them go onto the income statement.

Prepaid expense is considered as current asset and do go to the balance sheet

I agree with morgain.prepaid expenses go onto the balance sheet as assets.