At December 31, the unadjusted trial balance of H& R Tacks reports Prepaid Insurance of $ 7,200

Question:

At December 31, the unadjusted trial balance of H& R Tacks reports Prepaid Insurance of $ 7,200 and Insurance Expense of $ 0. The insurance was purchased on July 1 and provides coverage for 24 months. Prepare the adjusting journal entry on December 31. In separate T- accounts for each account, enter the unadjusted balances, post the adjusting journal entry, and report the adjusted balance.