Log in

View Full Version : Journal entry for prepaid insurance?


AQADIR1
Jun 20, 2011, 11:46 AM
Prepaid Insurance: 3,600
Insurance expires at the rate of $344 per month.

pready
Jun 20, 2011, 11:56 AM
When you purchase the insurance the journal entry will be:
Debit Prepaid Insurance for the amount paid
Credit Cash for the amount paid

To record the expired insurance the journal entry will be:
Debit Insurance Expense for the amount of insurance expired
Credit Prepaid Insurnance for the amount of insurance expired