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What is the proper adjusting entry at April 30, the end of the fiscal year, base

ID: 2488668 • Letter: W

Question

What is the proper adjusting entry at April 30, the end of the fiscal year, based on a prepaid insurance account balance before adjustment, $16,000, and unexpired amounts per analysis of policies, $6,000?

debit Prepaid Insurance, $10,000; credit Insurance Expense, $10,000

debit Insurance Expense, $16,000; credit Prepaid Insurance, $16,000

debit Insurance Expense, $6,000; credit Prepaid Insurance, $6,000

debit Insurance Expense, $10,000; credit Prepaid Insurance, $10,000

a.

debit Prepaid Insurance, $10,000; credit Insurance Expense, $10,000

b.

debit Insurance Expense, $16,000; credit Prepaid Insurance, $16,000

c.

debit Insurance Expense, $6,000; credit Prepaid Insurance, $6,000

d.

debit Insurance Expense, $10,000; credit Prepaid Insurance, $10,000

Explanation / Answer

D. debit insurance expense, 10000 ; credit prepaid Insurance , 10000

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