Harrod Company paid $6500 for a 4-month insurance premium in advance on November 1, with coverage beginning on that date. The balance in the prepaid insurance account before adjustment at the end of the year is $6500, and no adjustments had been made previously. The adjusting entry required on December 31 is:
A. Debit Prepaid Insurance, $3250; credit Insurance Expense, $3250.
B. Debit Insurance Expense, $3250; credit Prepaid Insurance, $3250.
C. Debit Insurance Expense, $1625; credit Prepaid Insurance, $1625.
D. Debit Prepaid Insurance, $1625; credit Insurance Expense, $1625.
E. Debit Cash, $6500; Credit Prepaid Insurance, $6500.
Answer: B
You might also like to view...
Qualitative information is relevant when:
A. it makes a difference in the decision only. B. it makes a difference in the decision and it differs between the alternatives. C. it differs between the alternatives only. D. None of the above.
A ______ is a positive moral trait or quality.
Fill in the blank(s) with the appropriate word(s).
Answer the following statements true (T) or false (F)
For all defined contribution plans, funding is shared by the employer and employee.
Which of the following pricing approaches is suitable for implementation of a survival pricing objective?
A) penetration pricing approach B) demand-based pricing approach C) markup pricing approach D) perceived-value pricing approach