Asked by George Greer on May 01, 2024
Verified
The prepaid insurance account had a beginning balance of $6,600 and was debited for $2,300 for premiums paid during the year. Journalize the adjusting entry required at the end of the year, assuming the amount of unexpired insurance related to future periods is $4,100.
Prepaid Insurance
Payments made in advance for insurance coverage, which are recorded as an asset and expensed over the period of coverage.
Adjusting Entry
An accounting record made to update the balances of accounts to reflect the true financial position before preparing financial statements.
Unexpired Insurance
The portion of the insurance premium that has not yet expired or been used up, considered a prepaid expense.
- Exhibit the skill to construct journal entries for routine adjusting transactions, encompassing prepayments, accruals, and depreciation.
- Determine and log changes for advance payments and accumulated expenses.
Verified Answer
Learning Objectives
- Exhibit the skill to construct journal entries for routine adjusting transactions, encompassing prepayments, accruals, and depreciation.
- Determine and log changes for advance payments and accumulated expenses.
Related questions
Gizmo Company Purchased a One-Year Insurance Policy on October 1 ...
Depreciation on Equipment for the Year Is $6,300 ...
On March 1, a Business Paid $3,600 for a 12-Month ...
On December 31, the Balance in the Office Supplies Account ...
The Balance in the Unearned Fees Account, Before Adjustment at ...