On 7/1/x2, Lincoln Company purchased a 1 year insurance policy for $24,000. What is the journal entry on 12/31/x2? Select one: a. Dr. Insurance Expense for $12,000 and Cr. Prepaid Insurance for $12,000 b. Dr. Insurance Expense for $4,000 and Cr. Prepaid Insurance for $4,000 c. No adjusting journal entry is required d. Dr. Insurance Expense for $24,000 and Cr. Prepaid Insurance for $24,000

On 7/1/x2, Lincoln Company purchased a 1 year insurance policy for $24,000. What is the journal entry on 12/31/x2? Select one: a. Dr. Insurance Expense for $12,000 and Cr. Prepaid Insurance for $12,000 b. Dr. Insurance Expense for $4,000 and Cr. Prepaid Insurance for $4,000 c. No adjusting journal entry is required d. Dr. Insurance Expense for $24,000 and Cr. Prepaid Insurance for $24,000

Accounting

27th Edition

ISBN:9781337272094

Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.

Publisher:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.

Chapter12: Accounting For Partnerships And Limited Liability Companies

Section: Chapter Questions

Problem 12.27EX: Revenue per employee Superior Cleaning Services, LLC, provides cleaning services for office...

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Q 27

Question 27

On 7/1/x2, Lincoln Company purchased a 1 year insurance policy for $24,000. What is the journal entry on 12/31/x2?

Select one:

a. Dr. Insurance Expense for $12,000 and Cr. Prepaid Insurance for $12,000

b. Dr. Insurance Expense for $4,000 and Cr. Prepaid Insurance for $4,000

c. No adjusting journal entry is required

d. Dr. Insurance Expense for $24,000 and Cr. Prepaid Insurance for $24,000

Definition Definition Method of recording financial transactions in the book of original entry by debiting and crediting the accounts affected by a transaction using the golden rules of accrual accounting.

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