Questions: Which of the following accounts is an asset? A. Prepaid Expense B. Accounts Payable C. Service Revenue D. Salaries Expense

The answer is the first one (A): Prepaid Expense.

Explanation for each option:

A. Prepaid Expense: This is an asset account. Prepaid expenses represent payments made for expenses that will benefit future periods. For example, if a company pays for a year's worth of insurance in advance, this payment is recorded as a prepaid expense and is considered an asset until the benefit is realized over time.

B. Accounts Payable: This is a liability account. Accounts payable represent amounts a company owes to suppliers for items or services purchased on credit. It is an obligation that the company needs to settle in the future.

C. Service Revenue: This is a revenue account. Service revenue represents the income earned from providing services. It is not an asset but rather an increase in equity resulting from business operations.

D. Salaries Expense: This is an expense account. Salaries expense represents the cost incurred for employee wages and salaries. It is not an asset but rather a decrease in equity due to business operations.

Summary: Prepaid Expense is an asset account because it represents payments made for future benefits. Accounts Payable is a liability, Service Revenue is a revenue, and Salaries Expense is an expense.