Cornhusker Supplies Inc. purchased a 12-month insurance policy on March 1, 2020, for $2,640. At March 31, 2020, the adjusting journal entry to record the expiration of this asset will include a: A) debit to prepaid insurance and a credit to insurance expense for $293. B) debit to Insurance expense and a credit to prepaid insurance for $220. C) debit to prepaid insurance and a credit to cash for $2,640. D) debit to insurance expense and a credit to cash for $220.

Principles of Accounting Volume 1
19th Edition
ISBN:9781947172685
Author:OpenStax
Publisher:OpenStax
Chapter9: Accounting For Receivables
Section: Chapter Questions
Problem 14EB: Anderson Air is a customer of Handler Cleaning Operations. For Anderson Airs latest purchase on...
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Cornhusker Supplies Inc. purchased a 12-month
insurance policy on March 1, 2020, for $2,640. At
March 31, 2020, the adjusting journal entry to record
the expiration of this asset will include a:
A) debit to prepaid insurance and a credit to insurance
expense for $293.
B) debit to Insurance expense and a credit to prepaid
insurance for $220.
C) debit to prepaid insurance and a credit to cash for
$2,640.
D) debit to insurance expense and a credit to cash for
$220.
Transcribed Image Text:Cornhusker Supplies Inc. purchased a 12-month insurance policy on March 1, 2020, for $2,640. At March 31, 2020, the adjusting journal entry to record the expiration of this asset will include a: A) debit to prepaid insurance and a credit to insurance expense for $293. B) debit to Insurance expense and a credit to prepaid insurance for $220. C) debit to prepaid insurance and a credit to cash for $2,640. D) debit to insurance expense and a credit to cash for $220.
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