Ask Experts Questions for FREE Help!
  Advanced
Register  |  Log in  
   Ask    
 Answer  
  Help  

Ask QuestionsprogressAnswer QuestionsprogressBuild ReputationprogressBecome an Expert
 
Free Answers in 3 Easy Steps

Register Now		 3 Steps

At Ask Me Help Desk you can ask questions in any topic and have them answered for free by our experts. To ask questions or participate in answering them you must register for a free account. By registering you will be able to:
  • Get free answers from experts in any of our 300+ topics.
  • Accept money for answers that you provide.
  • Communicate privately with other members (PM).
  • See fewer ads.

Home > Business & Careers > Accounting   »   Accounting for insurance renewal

Answer this Question Ask about Accounting
 
Question Tools Search this Question Display Modes
Question
 
 
#1  
Old Mar 21, 2008, 03:23 AM
babes08
New Member
babes08 is offline 		 
Join Date: Mar 2008
Posts: 3
babes08 See this member's comment history on his/her Profile page.
Accounting for insurance renewal
On oct 2007 i renewed the insurance for my car, i received the new policy and the amount is 13,000 for 13 months. I only paid the said amount early 2008. what would be my entry on oct and Dec 31, 2007? Should i record payable for the whole amount which is 13,000 or the expense portion only which is 3,000?

Reply With Quote
 
     

Answers
 
 
Old Mar 22, 2008, 03:57 PM   #2  
CaptainForest
Finance & Accounting Expert
CaptainForest is offline
 
CaptainForest's Avatar
 
Join Date: Nov 2005
Location: Canada
Posts: 3,658
CaptainForest See this member's comment history on his/her Profile page.CaptainForest See this member's comment history on his/her Profile page.CaptainForest See this member's comment history on his/her Profile page.CaptainForest See this member's comment history on his/her Profile page.
I take it the insurance is effective from Oct 1, 2007 until Oct. 32, 2008? (13 months)

I also assume your year end is Dec. 31?


Assuming the above…

Oct. 1
Dr. Prepaid Insurance 13,000
Cr. Insurance Payable 13,000

Dec. 31
Dr. Insurance Expense 3,000
Cr. Prepaid Insurance 3,000

Early 2008:
Dr. Insurance Payable 13,000
Cr. Cash 13,000

Summary: Record the asset when you agreed to it. Just because you were given some time to pay it, does not mean you didn’t have access to the asset.
  Reply With Quote
 
     
Answer this Question Ask about Accounting

« Previous Question | Next Question »

Question Tools Search this Question
Search this Question:

Advanced Search
Display Modes
Linear Mode Linear Mode

 
Similar Sponsors

Similar Questions
Question Asker Topic Answers Last Post
Involved in accident without insurance but she had insurance mrsfrank Insurance 10 May 6, 2008 12:44 PM
Insurance accounting Jacidr Accounting 0 Feb 29, 2008 01:56 PM
Insurance claim accounting GEETHA71 Accounting 0 Dec 13, 2007 11:35 PM
Motgage Insurance vs. Life Insurance question authority Insurance 6 Jun 14, 2007 11:03 AM
Re: Car Insurance Non-renewal rtrig1 Credit 1 Mar 20, 2007 02:40 PM




Copyright ©2003 - 2007, Ask Me Help Desk.
All times are GMT -8. The time now is 06:40 AM.

Content Relevant URLs by vBSEO 3.0.0 RC6 © 2006, Crawlability, Inc.