A company pays rent quarterly in arrears on 1 January, 1 April, 1 July and 1 October each year. The rent was increased from $90,000 per year to $120,000 per year as from 1 October 20X2. What rent expense and accrual should be included in the company's financial statements for the year ended 31 January 20X3?
A.
Rent expense $ 100,000 Accrual $ 20,000
B.
Rent expense $ 100,000 Accrual $ 10,000
C.
Rent expense $ 97,500 Accrual $ 10,000
D.
Rent expense $ 97,500 Accrual $ 20,000