A Company is making adjusting entries for the year ended December 31, 2011. In d

Question

A Company is making adjusting entries for the year ended December 31, 2011. In developing information for the adjusting entries, the accountant learned the following:

A two-year insurance premium of $3,600 was paid on October 1, 2011, for coverage beginning on that date.

At December 31, 2011, the following data relating to Shipping Supplies were obtained from the records and supporting documents.

What amount should be reported on the December 31, 2011, balance sheet for Prepaid Insurance? For Shipping Supplies?

A Company is making adjusting entries for the year ended December 31, 2011. In developing information for the adjusting entries, the accountant learned the following:

Explanation / Answer

31-Dec Amount should be reported on the Dec,31 2011 Balance Sheet

On Assets side Pre-paid Insurance 3,150

On Assets side Shipping Supplies 20,000

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