How do I record an entry for dec.31st if a business purchased a 2yr.policy on oct.1st

If the 2 year policy was purchased for 7,200, you must figure out the policy cost for each month. 7200 / 24 months = 300 per month. The expense for the policy on Dec 31 ( 3 months have passed, Oct, Nov, Dec) is 3 x 300= 900.