Making Insurance Payments in Advance Is an Example of A(n)

question 24

Multiple Choice

Making insurance payments in advance is an example of a(n) :

• A)Accrued revenue.
• B)Accrued expense.
• C)Deferred revenue.
• D)Prepaid expense.

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Definitions:

Salvage Value

The estimated resale value of an asset at the end of its useful life, typically considered in depreciation calculations.

Useful Life Estimate

The period over which a fixed asset is expected to be usable by a company, affecting depreciation calculations.

Retroactive Changes

Adjustments made to past financial statements, policies, or calculations to correct errors or align with new accounting standards.

Future Years

Refers to the period of time that lies ahead, used in planning, forecasting, or projecting financial and operational activities.