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    bball13's Avatar
    bball13 Posts: 1, Reputation: 1
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    #1

    Oct 16, 2008, 08:52 PM
    Adjusting entries
    What is the proper adjusting entry at June 30, the end of the fiscal year, based on a prepaid insurance account balance before adjustment, $15,500, and unexpired amounts per analysis of policies, $4,500?

    Would you subtract 4500 from the 15500 to be your adjusting entry, making it 11000
    pready's Avatar
    pready Posts: 3,197, Reputation: 207
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    #2

    Oct 18, 2008, 12:51 PM

    The unexpired amount of $4,500 should be the amount that still is in the Prepaid account after the adjusting entry.

    So you should do the adjusting entry for 11,000.

    Deibt Insurance Expense for 11,000
    Credit Prepaid insurance for 11,000
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