On December 1, your company paid its insurance agent $2,400 for the annual insurance premium covering the
Question:
On December 1, your company paid its insurance agent $2,400 for the annual insurance premium covering the twelve-month period beginning on December 1. The $2,400 payment was recorded on December 1 with a debit to the current asset Prepaid Insurance and a credit to the current asset Cash. Your company prepares monthly financial statements at the end of each calendar month. The following questions pertain to the adjusting entry that should be written by the company.36.
What date should be used to record the December adjusting entry?
Answer
37.
How many accounts are involved in the adjusting entry?
Answer
38.
What is the name of the account that will be debited?
Answer
39.
What is the name of the account that will be credited?
Answer
40.
What is the amount of the debit and the credit?
Answer
41.
What would be the effect on the financial statements if the company fails to make the adjusting entry on December 31?
Answer
Expert Answer:
36 December 31st is the date to record the December month adjusting entry or if the insurance pol... View the full answer
