Explore BrainMass
Share

This post addresses journal entries for expired insurance.

J. Bateman Enterprises prepaid $7,800 for a 12 month insurance policy on their delivery van beginning in October 2011. What would be the journal entry to recognize the monthly insurance that had been used up in January 2012?

Item Accounts and Explanations Post Ref DEBIT CREDIT
A Prepaid Insurance $7,800
Insurance Expense $7,800

B Cash $650
Insurance Expense $650

C Insurance Expense $650
Prepaid Insurance $650

D Insurance Expense $650
Cash $650

Answer
1. Item A is the correct entry
2. Item B is the correct entry
3. Item C is the correct entry
4. Item D is the correct entry

© BrainMass Inc. brainmass.com July 20, 2018, 7:00 am ad1c9bdddf

Solution Summary

The solution provides the correct answer for the journal entry to recognize the monthly insurance that had been used up in January 2012 for Bateman Enterprises.

$2.19