On July 1, a company paid the $2,280 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

The insurance expense on the annual income statement for the first year ended December 31 is $ 1,140.00

Explanation:

The insurance expense that would appear on the company's income statement for the year ended 31st December is the portion of the premium paid that relates to the commensurate timing horizon in the year i. e July 1 to 31 December, which gives six months in total.

Insurance expense=total premium paid*6/12

total premium paid is $2,280

insurance expense=$2,280*6/12=$ 1,140.00