Friday, October 9, 2020

Assume that $18,000 cash is paid for insurance to cover the next year. The appropriate debit and credit would be:

Assume that $18,000 cash is paid for insurance to cover the next year. The appropriate debit and credit would be:


A) Debit Insurance Expense $18,000, credit Prepaid Insurance $18,000.

B) Debit Prepaid Insurance $18,000, credit Insurance Expense $18,000.

C) Debit Prepaid Insurance $18,000, credit Cash $18,000.

D) Debit Cash $18,000, credit Prepaid Insurance $18,000.


Answer: C

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