On September 1, 2019, a Company Paid $8,400 in Advance

question 90

Multiple Choice

On September 1, 2019, a company paid $8,400 in advance for two years insurance and debited prepaid insurance. The December 31, 2019, adjusting entry should include a debit to:

• A)insurance expense for $1,400.
• B)insurance expense for $7,000.
• C)prepaid insurance for $2,800.
• D)prepaid insurance for $1,400.

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Definitions:

Behaviour Decision Model

A theory that explains how individuals make decisions based on the acknowledgment of available alternatives, possible outcomes, and the implications of their choices.

Cognitive Limitations

Refers to the inherent restrictions in human cognitive capacity, affecting memory, attention, and the ability to process information.

Preferred Course Of Action

The most favored plan or method to achieve a desired outcome or solve a problem.

Satisficing Decision

A decision-making process where the first acceptable solution is chosen, rather than seeking the optimal solution, often due to time or information constraints.