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6. On August 1, 2025, Yellow Company paid $6,320 for a three-year insurance policy. On that date, an expense account was charged. In the adjusting entry on December 31, 2025, there would be a a. debit to Insurance Expense for $175. b. credit to Prepaid Insurance for $2,107. c. credit to Prepaid Insurance for $527. d. credit to Insurance Expense for $5,442.

6. On August 1, 2025, Yellow Company paid $6,320 for a three-year insurance policy. On that date, an expense account was charged. In the adjusting entry on December 31, 2025, there would be a a. debit to Insurance Expense for $175. b. credit to Prepaid Insurance for $2,107. c. credit to Prepaid Insurance for $527. d. credit to Insurance Expense for $5,442.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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6. On August 1, 2025, Yellow Company paid $6,320 for a three-year insurance policy. On that date, an expense account was charged. In the adjusting entry on December 31, 2025, there would be a a. debit to Insurance Expense for $175. b. credit to Prepaid Insurance for $2,107. c. credit to Prepaid Insurance for $527. d. credit to Insurance Expense for $5,442.
Transcribed Image Text:6. On August 1, 2025, Yellow Company paid $6,320 for a three-year insurance policy. On that date, an expense account was charged. In the adjusting entry on December 31, 2025, there would be a a. debit to Insurance Expense for $175. b. credit to Prepaid Insurance for $2,107. c. credit to Prepaid Insurance for $527. d. credit to Insurance Expense for $5,442.
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