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21-03-2024
Business

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A company purchases a one-year insurance policy on June 1 for $1,260. On December 31, what should be the adjusting entry? (assume that the company only makes adjusting entries at its December 31st year end)
a. Debit Prepaid Insurance, $630; credit Cash, $630.
b. Debit Insurance Expense, $735; credit Prepaid Insurance, $735.
c. Debit Insurance Expense, $630; credit Prepaid Insurance, $630.
d. Debit Insurance Expense, $525; credit Prepaid Insurance, $525.

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