On January 1, 20x1, ABC Co. insured the life of one of its key management personnel...

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On January 1, 20x1, ABC Co. insured the life of one of its key management personnel for P1, 000,000. ABC Co. is the beneficiary. The insurance policy requires annual payments of P50,000 at the start of each year. Information on the cash surrender value is shown below: Policy year Cash surrender value Dec. 31, 20x1 Dec 31, 20x2 Dec. 31, 20x3 Dec 31, 20x4 Dec 31, 20x5 18,000 21,000 32,000 Additional information: ABC Co. received P4,000 cash dividend from the life insurance on April 1, 20x4. The key employee died on October 1, 20x5. Requirements: Provide the journal entries on the following dates (Use the asset method of recording disbursements.) a. January 1, 20x1 and December 31, 20x1 (adjusting) b. December 31, 20x3 (cash surrender value) c. April 1, 20x4 (dividends) d. December 31, 20x4 (cash surrender value) e. January 1, 20x5 (payment of insurance premium) f. March 31, 20x5 (assume the policy is also collected on this date) On January 1, 20x1, ABC Co. insured the life of one of its key management personnel for P1, 000,000. ABC Co. is the beneficiary. The insurance policy requires annual payments of P50,000 at the start of each year. Information on the cash surrender value is shown below: Policy year Cash surrender value Dec. 31, 20x1 Dec 31, 20x2 Dec. 31, 20x3 Dec 31, 20x4 Dec 31, 20x5 18,000 21,000 32,000 Additional information: ABC Co. received P4,000 cash dividend from the life insurance on April 1, 20x4. The key employee died on October 1, 20x5. Requirements: Provide the journal entries on the following dates (Use the asset method of recording disbursements.) a. January 1, 20x1 and December 31, 20x1 (adjusting) b. December 31, 20x3 (cash surrender value) c. April 1, 20x4 (dividends) d. December 31, 20x4 (cash surrender value) e. January 1, 20x5 (payment of insurance premium) f. March 31, 20x5 (assume the policy is also collected on this date)

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