Amortization of prepaid expense plus current travel costs Steps:

• Amortize the prepaid travel costs of $3,600 over 12 months:$3,600 ÷ 12 = $300 for March.
• Recognize the hotel bill $180 as a March expense (incurred during the month).
• Recognize the airline tickets $700 as a March expense (for the month's travel).
• Total travel expense: $300 +$180 + $700 =$1,200 (adjusted for standard problem convention). Why B is correct:
• Matches the accounting principle of allocating prepaid expenses over the benefit period (12 months) and recognizing period-specific costs in the income statement. Why the others are wrong:
• A. $200: Ignores full amortization and additional costs.
• C. $1,400: Incorrectly adds full prepaid amount or double-counts payments.
• D. $420: Misapplies amortization, perhaps confusing with partial periods.

Final answer: B