On November 1, 20X8, your calendar year company pays $1,200 for 12 months’ insur

Question

On November 1, 20X8, your calendar year company pays $1,200 for 12 months’ insurance, recording it as an asset. Just before closing the books, you realize that no adjusting entry was made. The correcting entry will: Not be necessary debit an expense account for $1,000; credit an asset account for $1,000 debit an expense account for $200; credit an asset account for $200 debit an asset account for $200; credit an expense account for $200 debit an asset account for $1,000; credit an expense account for $1,000

Explanation / Answer

Insurance expense has to be recognized for 2 months debit an expense account for $200; credit an asset account for $200

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