On 1 July 2011 Tan Traders Paid $600,representing a Two-Year

question 38

Multiple Choice

On 1 July 2011 Tan Traders paid $600,representing a two-year insurance premium.The $600 was initially recorded in the Insurance expense account.After adjustment at 31 December 2012,the close of the annual accounting period:

• A)Insurance expense in the income statement is $600 and prepaid insurance in the balance sheet is $0
• B)Insurance expense in the income statement is $150 and prepaid insurance in the balance sheet is $450
• C)Insurance expense in the income statement is $450 and prepaid insurance in the balance sheet is $0
• D)Insurance expense in the income statement is $300 and prepaid insurance in the balance sheet is $150

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Definitions:

Rigid Double-Drawbar System

A specific hitching setup in towing configurations where two drawbars are used in a rigid manner to link a truck and a trailer or between trailers.

Pivot Points

Locations on a vehicle or machinery where parts pivot or rotate around a fixed point, crucial for the movement or operation of certain components.

Semi-Trailer

A type of trailer designed to be attached and towed by a tractor unit, with a significant portion of its weight borne by the tractor.

Linehaul Application

Refers to the use of vehicles or equipment for long-distance transportation of goods, typically involving large trucks or freight services.