On August 1, Covington Motors Pays £18,000 for Insurance Coverage

On August 1, Covington Motors pays £18,000 for insurance coverage for the next 12 months.On August 1, the firm records the following journal entry:

A) Prepaid Insurance. . . . . . . . . . . . . . 18,000
Insurance Expense . . .. .. . . . . . . . 18,000
B) Prepaid Insurance. . . . . . . . . . . . . . 18,000
Cash. . . . . . . . . . . . . . . . . . . 18,000
C) Insurance Expense. . . . . . . . . . . . . . 18,000
Prepaid Insurance . . . . . . . . . . . . 18,000
D) Liability for Prepaid Insurance . . . . . . . 18,000
Cash. . . . . . . . . . . . . . . . . . . . 18,000
E) Prepaid Insurance. . . . . . . . . . . . . . 18,000
Liability for Prepaid Insurance . . . . . . 18,000

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