On 30 June, the Last Day of Its Financial Year

question 20

Multiple Choice

On 30 June, the last day of its financial year, Fast Deliveries Ltd paid $1200 cash for a one-year insurance policy. What is the appropriate journal entry to record the payment, assuming the insurance policy becomes effective on 1 July?

• A) Dr Insurance expense $1200 Cr Prepaid insurance $1200
• B) Dr Prepaid insurance $1200 Cr Cash $1200
• C) Dr Cash $1200 Cr Prepaid insurance $1200
• D) Dr Prepaid insurance $ 120 Cr Insurance expense $ 120

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Definitions:

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A term for varying degrees of cognitive impairment that affect intellectual functions and adaptive behavior.

Factor Analyzed

A statistical technique employed to discover fundamental factors or elements that clarify the correlation patterns among a group of observable variables.

Content Validity

Refers to the extent to which a test accurately measures or reflects the specific content of what it is supposed to assess.

Representative Sample

A portion of the population that accurately mirrors the entire group's attributes.