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Examveda

Prepaid expenses are considered as

A. Asset

B. Liability

C. Loss

D. Capital

Answer: Option A

Solution(By Examveda Team)

Prepaid expenses are considered as Asset. Prepaid expenses are future expenses that have been paid in advance. You can think of prepaid expenses as costs that have been paid but have not yet been used up or have not yet expired. The amount of prepaid expenses that have not yet expired are reported on a company's balance sheet as an asset.

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