Which of the Following Journal Entries Correctly Records Paying for a $900

question 60

Multiple Choice

Which of the following journal entries correctly records paying for a $900 one year insurance policy in advance?

• A) \(\begin{array} { | c | r | r | }
• \hline \text { Insurance expense } & 900 & \\
• \hline \text { Prepaid insurance } & & 900 \\
• \hline
• \end{array}\)
• B) \(\begin{array} { | c | r | r | }
• \hline \text { Prepaid insurance } & 900 & \\
• \hline \text { Insurance payable } & & 900 \\
• \hline
• \end{array}\)
• C) \(\begin{array} { | c | r | r | }
• \hline \text { Insurance expense } & 900 & \\
• \hline \text { Cash } & & 900 \\
• \hline
• \end{array}\)
• D) \[\begin{array} { | c | r | r | }
• \hline \text { Prepaid insurance } & 900 & \\
• \hline \text { Cash } & & 900 \\
• \hline
• \end{array}\]

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