On June 1, Year 1, Company X paid $7,200 for a three-year insurance policy that became...

On June 1, Year 1, Company X paid $7,200 for a three-year insurance policy that became effective on that same date.
$_________ Year 1 Insurance Expense
$_________ Insurance Payable at Dec. 31, Year 1 [If none, so state.]
$_________ Prepaid Insurance at Dec. 31, Year 1 [If none, so state]
On April 1, Year 2, Paul added an additional policy when the firm paid $2,400 for a two-year policy that became effective on that same day.
$_________ Year 2 Insurance Expense
$_________ Prepaid Insurance at Dec. 31, Year 2 [If none, so state.]
$_________ Insurance Payable at Dec. 31, Year 2 [If none, so state.]
$_________ Cash paid for Insurance in Year 2

Expert Solution

ekkarill92 answered 2 years ago

1. On June 1, King Company paid $7,200 for one year of advertising, in advance. King...

1. On June 1, King Company paid $7,200 for one year of advertising, in advance. King Company recorded the transaction by debiting Prepaid Advertising and crediting Cash. Required: Journalize the adjusting entry on December 31. Note: Assume that the advertising is used evenly throughout the year 2. By the end of December, Brown Company has completed work, earning $2,500. Brown company has neither billed the clients nor recorded any of the revenue. Required: Journalize the adjusting entry on December 31....

Oriole Company paid $25800 on June 1, 2017 for a two-year insurance policy and recorded the...

Oriole Company paid $25800 on June 1, 2017 for a two-year insurance policy and recorded the entire amount as Insurance Expense. The December 31, 2017 adjusting entry

On April 1, a company paid the $1,800 premium on a three-year insurance policy with benefits...

On April 1, a company paid the $1,800 premium on a three-year insurance policy with benefits beginning on that date. What amount of the insurance expense will be reported on the annual income statement for the year ended December 31? a. $1,350.00. b. $450.00. c. $600.00. d. $1,800.00. e. $50.00.

A company paid the $1,350 premium on a three-year insurance policy on April 1, 2020. The...

A company paid the $1,350 premium on a three-year insurance policy on April 1, 2020. The policy gave protection beginning on that date. How many dollars of the premium will appear as an expense on the calendar year 2020 income statement assuming the accrual basis of accounting? Assuming the cash basis of accounting?

On October 1 of Year 1 Lesikar Company paid $1,200 cash for an insurance policy that...

On October 1 of Year 1 Lesikar Company paid $1,200 cash for an insurance policy that would provide protection for a one year term. Which of the following shows how the required adjustment on December 31, Year 1 will affect Lesikar’s ledger accounts? Assets = Liabilities + Stockholders’ Equity Cash + Prepaid Insurance = Accounts Payable + Common Stock + Retained Earnings (1,200) 1,200 Assets = Liabilities + Stockholders’ Equity Cash + Prepaid Insurance = Accounts Payable + Common Stock...

On July 1, a company paid the $1,200 premium on a one-year insurance policy with benefits...

On July 1, a company paid the $1,200 premium on a one-year insurance policy with benefits beginning on that date. What will be the insurance expense on the annual income statement for the first year ended December 31? Multiple Choice $500. $600. $300. $1,200. $900.

On August 1, a company paid the $2,400 premium on a one-year insurance policy with benefits...

On August 1, a company paid the $2,400 premium on a one-year insurance policy with benefits beginning on that date. What will the balance be in the Prepaid Insurance account on the Balance Sheet for the current year ended December 31? Select one: A. $1,000. B. $2,400. C. $1,400. D. $400. E. $1,200.

On May 1 a business paid $4,800 for twelve-month liability insurance policy. Also on June 1,...

On May 1 a business paid $4,800 for twelve-month liability insurance policy. Also on June 1, the same business entered into a twelve-month rental contract for equipment for $12,000. Determine the following amounts: (a) prepaid insurance as of May 31, (b) prepaid rent as of June 30 (c) insurance expense for May and rent expense for June. (a) (b) (c) There was a $1,500 balance in the supplies account at the beginning of the period. During the period, the supplies...

Albinson Company paid $96,000 for a two-year insurance policy on October 1 and recorded the $96,000...

Albinson Company paid $96,000 for a two-year insurance policy on October 1 and recorded the $96,000 as a debit to Prepaid Insurance and a credit to Cash. What adjusting entry should Albinson make on December 31, the end of the accounting period (no previous adjustment has been made)? Select one: A. Insurance Expense 12,000 Prepaid Insurance 12,000 B. Insurance Expense 48,000 Prepaid Insurance 48,000 C. Prepaid Insurance 12,000 Insurance Expense 12,000 D. Prepaid Insurance 84,000 Insurance Expense 84,000

On April 1, Year8, the premium on a one-year insurance policy on equipment was paid. The...

On April 1, Year8, the premium on a one-year insurance policy on equipment was paid. The premium was $3,000. The company does not have any other insurance policies. The financial statements as of 12/31/Year8 would report: a. Insurance expense $750; Prepaid insurance $2,250. b. Insurance expense $0; Prepaid insurance $3,000. c. Insurance expense $2,250; Prepaid insurance $750. d. Insurance expense $2,000; Prepaid insurance $1000. e. Insurance expense $3,000; Prepaid insurance $0.

Question