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    Adjusting entry

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    Problem 5:
    On July 1, 2006, Orlow Co. pays $12,000 to Pizner Insurance Co. for a 3-year insurance contract. Both companies have fiscal years ending December 31. For Orlow Co., journalize and post the entry on July 1 and the adjusting entry on December 31.

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    Problem 6:
    Using the data in problem 5, journalize and post the entry on July 1 and the adjusting entry on December 31 for Pizner Insurance Co. Pizner uses the accounts Unearned Insurance Revenue and Insurance Revenue.

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    https://brainmass.com/business/business-math/steps-adjusting-entry-89144

    Solution Preview

    Problem 5

    Prepaid Insurance A/c Dr. 12000
    To Cash A/c 12000
    (Being cash paid for 3 year insurance ...

    Solution Summary

    This provides the steps for adjusting entry.

    $2.19

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