Choco Company's prepaid insurance was $10,000 at December 31, 2012, and $15,000 at December 31, 2013. Choco

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Question:

Choco Company's prepaid insurance was $10,000 at December 31, 2012, and $15,000 at December 31, 2013. Choco reported insurance expense of $25,000 on the 2013 income statement. What amount would be reported in the statement of cash flows as insurance paid using the direct method?

A. $20,000.

B. $25,000.

C. $30,000.

D. $35,000.