On January 1, 2023, the balance in the prepaid insurance account was $2,500. On December 31, 2023, after the 2023 adjusting entries were made, the balance of the prepaid insurance account was $1,200. During 2023, cash payments for insurance premiums amounted to $5,000, which was debited to the prepaid insurance account.

 Prepare the adjusting entry, which must have been made at December 31, 2023

Answer rating: 100% (QA)

The adjusting entry needed at December 31 2023 would be to recognize the portion of prepaid insu... View the full answer