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    jolene0879's Avatar
    jolene0879 Posts: 3, Reputation: 1
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    #1

    Jun 11, 2010, 06:11 PM
    Adjusting Entries for Prepaid Insurance
    An examination of the prepaid Insurance account shows a balance of $10,280 at the end of an accounting period, before adjustment. Prepare entries in journal form to record the insurance expense for the period under the following independent assumptions:

    1. An examination of the insurance policies shows unexpired insurance that cost $4,935 at the end of the period.

    2. An examination of the insurance policies shows insurance that cost $1,735 has expired during the period.
    pready's Avatar
    pready Posts: 3,197, Reputation: 207
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    #2

    Jun 12, 2010, 08:41 AM

    1. You need to calculate the difference between the 2 amounts. This is your insurance expense amount.

    2. The amount is given to you.

    The journal entries will be: Debit Insurance Expense for the amount and Credit Prepaid Insurance for the amount.
    jolene0879's Avatar
    jolene0879 Posts: 3, Reputation: 1
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    #3

    Jun 12, 2010, 05:53 PM

    Thanks so much for your help and time.
    ka123's Avatar
    ka123 Posts: 1, Reputation: 1
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    #4

    Feb 12, 2011, 09:37 PM
    Can you show me how to record of Unexpired insurance?
    pready's Avatar
    pready Posts: 3,197, Reputation: 207
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    #5

    Feb 13, 2011, 09:17 AM

    The unexpired insurance amount will be the amount in Prepaid Insurance at the end of the acounting period after the adjusting entries have been made.
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