The asset of FAC in the form of $900 cash is no longer held by the FAC. The occupational rent payments are agreed to be made monthly.
On January 3, FAC pays office rent for January in cash, $900.
How to debit and credit payment of rent expenses? On the other hand, the cost of resources that still has future benefits is recorded as assets. In accounting, expenses are recognized and recorded to reflect the cost of such resources that has been consumed or used up. For example, the office used by an advertising company requires the use of electricity, services performed by employees, and office supplies.