ACCOUTNING UGH Mountaineer Excavation operates in a lowlyin

??? ACCOUTNING UGH

Mountaineer Excavation operates in a low-lying area that is subject to heavy rains and flooding. Because of this, Mountaineer purchases one year of flood insurance in advance on March 1, paying $30,600 ($2,550/month). value: 1.00 points Required information o You did not receive full credit for this question in a previous attempt 1. & 2. Record the necessary entries in the Journal Entry Worksheet below. (If no entry is required for a particular transaction/event, select \"No journal entry required\" in the first account field.) View transaction list view journal entry worksheet No Date General Journal Debit Credit 1 March 01 Prepaid insurance 30,600 Cash 30,600 2 December 31 Prepaid insurance 10,200 10.200 Cash

Solution

Answer

Date

Dr. $

Cr. $

March 1

Prepaid Insurance ($2,550 * 12 Months)

30,600

Cash / Bank

30,600

(Being insurance paid in advance)

December 31

Insurance Expense ($2,550 * 10)

25,500

Prepaid Insurance

25,500

(Being Insurance expense for 10 months i.e. from March to December adjusted)

Date		Dr. $	Cr. $
March 1	Prepaid Insurance ($2,550 * 12 Months)	30,600
	Cash / Bank		30,600
	(Being insurance paid in advance)
December 31	Insurance Expense ($2,550 * 10)	25,500
	Prepaid Insurance		25,500
	(Being Insurance expense for 10 months i.e. from March to December adjusted)