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    grace.device's Avatar
    grace.device Posts: 5, Reputation: 1
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    #1

    Sep 7, 2010, 06:01 PM
    What is the journal entry for amortization of insurance?
    I am confused if what is the credit account I'm going to used.. is it to credit prepayments or amortization account?
    morgaine300's Avatar
    morgaine300 Posts: 6,561, Reputation: 276
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    #2

    Sep 7, 2010, 08:27 PM

    You don't amortize insurance - you expense it.

    When you purchase insurance in advance, it's prepaid insurance, which is an asset account because you still have coverage (which has a worth) coming to you. As it expires, you remove it from the prepaid account and expense it.

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