Prepaid expenses are first recorded in the prepaid asset account on the balance sheet. The GAAP matching principle prevents expenses from being recorded on the income statement before they incur.

The sum of the remaining 11 premiums is bucketed into a prepaid insurance account that's classified as a current asset on the balance sheet and in a working capital calculation. The prepaid ...

and prepaid liabilities. Current assets are sometimes referred to as current accounts. Current assets is an account listed on a balance sheet that shows the value of the assets owned by a company.