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14 July, 01:18

The prepaid insurance account had a beginning balance of $4,500 and was debited for $16,600 of premiums paid during the year. Journalize the adjusting entry required at the end of the year, assuming the amount of unexpired insurance related to future periods is $5,600. Refer to the Chart of Accounts for exact wording of account titles.

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  1. 14 July, 05:07
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    prepaid expense 15,500 debit

    prepaid insurance 15,500 credit

    Explanation:

    The amount of unexpired insurance will be the ending balance of the account

    4,500 debit

    + 16,600 premium paid

    + / - adjustment

    5,600 ending

    4,500 + 16,600 - 5,600 = 15,500
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