NAC706.711. Current assets: Account for prepaid expenses.

     1. The account for prepaid expenses includes amounts representing prepayments, for example, insurance, rents, taxes and other items, and must be maintained and supported in such manner as to disclose the amount of each class of prepayments. Subaccounts may be maintained for this purpose.

     2. Where prepayments are made, this account must be charged with the full amount of prepayment and subsequently credited with each portion that will ratably distribute the prepayment to expense over the benefited period. A portion ratably credited to prepaid expense must be charged to the appropriate functional accounts for operating expense.

     [Taxicab Auth., Uniform System of Accounts Reg. § 190, eff. 12-24-70; A 11-16-79]