Question

what kind of general entry would I need to make for this? 1 Purchased a one-year...

what kind of general entry would I need to make for this?

1 Purchased a one-year insurance policy to be consumed evenly over the next 12 months, $4,800. 4. Prepaid insurance has expired. I know the answer if tihs was one month but what do i do for expiring insurance

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Homework Answers

Answer #1

date

General Journal

debit

credit

NA

prepaid insurance

$   4,800

cash

$ 4800

(prepaid insurance paid)

NA

Insurance expense*

$      400

prepaid insurance

$400

(one month insurance expired)

working note

insurance expense to be recognised(4800/12*1) = $400

                          

*Expired insurance for 1 month will be considered as an expense

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