For each separate case below, follow the three$-$step process for adjusting the prepaid asset account at December $31$

Step $1$: Determine what the current account balance equals.

Step $2$: Determine what the current account balance should equal.

Step $3$: Record the December $31$ adjusting entry to get from step $1$ to step $2.$

Assume no other odjusting entries ore mode during the yeor.

a$.$ Prepald Inaurance. The Prepald insurance account has a $\backslash (\backslash$$ $5,700\backslash )$ deblt balance to atart the year. A review of ingurance pollcles ahowa that $\backslash (\backslash$$ $1,400\backslash )$ of unexplred Inaurance remalna at year$-$end.

b$.$ Prepald Insurance. The Prepald Inaurance account has a $\backslash (\backslash$$ $6,890\backslash )$ deblt balance at the atart of the year. A review of Inaurance pollcles ahowa $\backslash (\backslash$$ $1,440\backslash )$ of Inaurance has explred by year$-$end.