On November 1, 2010, Wenger Co. paid its landlord $25,200 in cash as an advance rent payment on its store location. The six-month period ends on April 30, 2011, at which time the contract may be renewed.
d. If the advance payment made on November 1, 2010, had covered an 18-month lease period at the same amount of rent per month, how should Wenger Co. report the prepaid amount on its December 31, 2010 balance sheet?