We pay someone for the services we seek from them at present or in future.
B R Ambedkar National Institute of Technology
Prepaid Expenses are amounts that are paid in advance to a vender or creditor for goods and services. Typically, insurance premiums are paid in advance of the coverage contained in the policy. Prepaid Expenses is a Current Asset for our business. This is because we have paid for something and someone owes us the service or the goods for which we prepaid. Source:http://in.docsity.com/en-docs/Fixed_Assets_Part_2-Financial_Accounting-Lecture_Handout_