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Sagot :
This is true that at closing, the seller receives credits for prepaid expenses related to the property.
What are prepaid expenses?
Future costs that are already paid for, such as rent or insurance, are referred to as prepaid expenses. Prepaid expenses are first listed as an asset on the balance sheet. The cost is subsequently recorded as an expense as the benefits of the assets are realized over time.
Prepaid expenses are first noted on the balance sheet, after which the income statement is updated as the benefit of the prepaid expense is realized or as the expense is incurred.
Seller's Prepaid Expenses refers to all of the Sellers' prepaid rent and prepaid expenses associated with the Acquired Assets and the Business, including, without limitation,
- All rent, Taxes, common area maintenance, and similar charges under the Leases.
- Water charges, sewage rents, and vault charges, if any.
- Value of fuel stored on the Real Property that is a part of the Acquired Assets (bought and paid for by Seller).
To know more about prepaid expenses refer to : https://brainly.com/question/15073534
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