Dannon co. reported its expenses of $35,200 on the cash basis. corporate records revealed the following information: beginning prepaid expense $1,300 beginning accrued expense 1,650 ending prepaid expense 1,800 ending accrued expense 1,200 what amount of expense should the dannon report on its books under the accrual basis?

Explanation:

The computation of expense amount is shown below:

=  Expenses - adjusted prepaid expense + adjusted accrued expense

= $35,200 - $500 -  $450

=  $34,250

The adjusted prepaid expense is computed by

= Ending balance of prepaid expense - beginning balance of prepaid expense

= $1,800 - $1,300

= $500

And, the The adjusted accrued expense is computed by

= Ending balance of accrued expense - beginning balance of accrued expense

= $1,200 - $1,650

= -$450

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