Hello! Trying to determine the proper recording. If company year end is Dec 31st, and a prepaid contract is paid for on Dec 15th, but the contract is for Jan 1 - Dec 31st of the next year, do you still record as a prepaid expense, despite having no contract service till the next year? What else would you debit?

An example is Prepaid Insurance. You purchase insurance for a Year.

the first journal entry to record the transaction is:
Debit Prepaid Insurance for the amount paid.
Credit Cash for the amount paid.

to record the usage of the insurance the journal entry is:
Debit Insurance Expense for the amount used. (Amount of insurance/12 = amount used per month)
Credit PrePaid Insurance for the amount