On June 30, the end of the current fiscal year, the following information is available to Sterling Company’s accountants for making adjusting entries:
The Prepaid Insurance account shows the following entries on June 30:
Beginning Balance $ 1,530
January 1 $2,900
May 1 $3,366
The beginning balance represents the unexpired portion of a one-year policy purchased the previous year. The January 1 entry represents a new one-year policy, and the May 1 entry represents the additional coverage of a three-year policy.
Insurance Expense?
Prepaid Insurance?