Answer to Question #194378 in Accounting for jone

Question

Problem 1 The prepaid insurance account had a balance of $4,750 at the beginning of the year. The account was debited for $5,150 for premiums on policies purchased during the year. Prepare the adjusting entry required at the end of the year under each of the following alternatives; (a) the amount of unexpired insurance applicable to future periods is $4,300. (b) The amount of insurance expired during the year is $5,550. 

Answer 1

(a) insurance expense= beginning prepaid insurance + cash premium paid - ending prepaid insurance = 4750+5150-4300= $\$$ 5600

(b)