Beginning and Ending Prepaid Insurance Is $36,000 and $26,500 Respectively

question 22

Multiple Choice

Beginning and ending prepaid insurance is $36,000 and $26,500 respectively. During the period, $30,500 of insurance expense was recorded. How much new insurance was purchased?

• A)$2,500
• B)$15,600
• C)$49,000
• D)$21,000

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Definitions:

Predetermined Price

A price established in advance for transactions, often based on cost estimates or contractual agreements.

Multinational Organization

is a business entity that operates in multiple countries outside of its original or home country, managing production or delivering services in several countries.

Market Price

The current price at which an asset or service can be bought or sold in a particular market, determined by supply and demand dynamics.

Open Pay System

A compensation strategy where an organization openly shares salary ranges and sometimes individual salaries, aiming for transparency.