Multiple Choice
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. . . . . . . . . . .. . . 1,500
Insurance Expense . . . . . . . . . . . . 1,500
B) Prepaid Insurance. . . . . . . . . . .. . . 1,500
Cash. . . . . . .. . . . . . . . . . . . 1,500
C) Insurance Expense. . . . . . . . . . . . . 1,500
Prepaid Insurance . . . . . . . . . . 1,500
D) Liability for Prepaid Insurance . . . . . .1,500
Cash. . . . . . . . . . . . . . . . 1,500
E) Prepaid Insurance. . . . . . . . . . . . . 1,500
Liability for Prepaid Insurance . . . . 1,500
Correct Answer:
Verified
Correct Answer:
Verified
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