Question
On July 1 2011 Tan Traders paid $600, representing a two year insurance premium. The $600...
On July 1 2011 Tan Traders paid $600, representing a two year insurance premium. The $600 was intially recorded in the insurance expense account. After the adjustment at 31 Dec 2012 the close of the annusl account period (Select One):
a. Insurance expense in the income statement is $600 and prepaid insurance in the balance sheet is $0
b. Insurance expense in the income statement is $150 and prepaid insurance in the balance sheet is $450
c. Insurance expense in the income statement is $450 and prepaid insurance in the balance sheet is $0
d. Insurance expense in the income statement is $300 and prepaid insurance in the balance sheet is $150
(I think the Answer is B?)
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