Answer (D) is correct . Prepaid expenses, such as supplies, prepaid rent, and prepaid insurance, are reported on the balance sheet at cost minus the expired or used portion. These are typically current assets.
Answer (A) is incorrect because The cost must be reduced by the expired or used portion of the prepaid asset.
Answer (B) is incorrect because Prepaid expenses will not be collected at maturity.
Answer (C) is incorrect because Prepaid expenses are not depreciated; they expire.
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