prepaid expense
Definition
An accounting term signifying money paid for goods or services upfront. A prepaid expense is considered an asset on the balance sheet. As the goods and services are delivered they are recorded on the income statement. An example of a prepaid expense is insurance, since the policy holder pays money upfront to cover the risk of possible damaging event occurring in the future.
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'prepaid expense
' appears in the definitions of these other terms on BusinessDictionary.com
operating asset, deferred charge, tangible net worth, other assets
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