ngocanh
Aug 9, 2008, 01:18 AM
I'm still not clear of how to correct the prepaid expense. Let's say... I paid 20,000 for 5 years of insurance and I charge all to expense account on the first year... the correct entry should be:
First year...
Debit insurance expense 4,000
Debit prepaid insurance 16,000
Credit R.E 20,000
Second year... it would be normal entry?
Debit insurance expense 4,000
Credit prepaid expense 4,000
??
First year...
Debit insurance expense 4,000
Debit prepaid insurance 16,000
Credit R.E 20,000
Second year... it would be normal entry?
Debit insurance expense 4,000
Credit prepaid expense 4,000
??