On November 1, the company paid 9,000 for three months’ rent in advance. Assets. = Liabilities. + Shareholders’ Equity. Contributed Capital. Retained Earnings. (9,000) Cash. + 9,000 Prepaid Rent. Rent is also usually paid in advance. In the accounting records, prepaid rent is treated exactly the same way as prepaid insurance. When the company pays the cash for rent in advance, an asset called prepaid rent is recorded. The disbursement of cash for prepaid rent is an asset exchange. Suppose a company paid 9,000 to rent a warehouse for three months, beginning on November 1, the date of the payment. Copyright 2003 Prentice Hall Publishing.