On January 2021, ABC Co. insured the life of one of its key management personnel for 1,300,000. ABC Co. is the beneficiary. The insurance requires annual payments of P62,000 at the start of each year. Information on the cash surrender value is shown below: Policy year Cash Surrender Value December 31, 2021 0 December 31, 2022 0 December 31, 2023 21,000 December 31, 2024 26,000 December 31, 2025 32,000 Additional Information: ABC Co received Php12,000 dividend from life insurance on March 20, 2024. The employee died on March 12, 2026. Requirement: Provide the journal entries from the inception of the life insurance up to the death of the employee.
On January 2021, ABC Co. insured the life of one of its key management personnel for 1,300,000. ABC Co. is the beneficiary. The insurance requires annual payments of P62,000 at the start of each year. Information on the cash surrender value is shown below: Policy year Cash Surrender Value December 31, 2021 0 December 31, 2022 0 December 31, 2023 21,000 December 31, 2024 26,000 December 31, 2025 32,000 Additional Information: ABC Co received Php12,000 dividend from life insurance on March 20, 2024. The employee died on March 12, 2026. Requirement: Provide the journal entries from the inception of the life insurance up to the death of the employee.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
On January 2021, ABC Co. insured the life of one of its key management personnel for
1,300,000. ABC Co. is the beneficiary. The insurance requires annual payments of P62,000 at the start of
each year. Information on the cash surrender value is shown below:
Policy year Cash Surrender Value
December 31, 2021 0
December 31, 2022 0
December 31, 2023 21,000
December 31, 2024 26,000
December 31, 2025 32,000
Additional Information:
ABC Co received Php12,000 dividend from life insurance on March 20, 2024.
The employee died on March 12, 2026.
Requirement: Provide the
employee.
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