On October 1 2015 a company paid an 25200 to that policy and

On October 1, 2015, a company paid an $25,200 to that policy and fill in the blanks in the following table Chec premium on a 36-month insurance policy for coverage beginning on that date. Refer Balance Sheet Prepaid Insurance Insurance Expense Cash Basis Dec. 31, 2015 Dec. 31, 2016 Dec. 31, 2017 Dec. 31, 2018 2015 of 1 2 2

Solution

Under accrual basis, depreciation expense per year = 25200/3= 8400 Depreciation expense for Dec 31 2015 = 8400/12*3= 2100 Depreciation expense for Dec 31 2018 = 8400/12*9= 6300 Prepaid insurance Insurance expense Accrual basis Cash basis Accrual basis Cash basis Dec-31,2015 23100 0 2015 2100 25200 Dec-31,2016 14700 0 2016 8400 0 Dec-31,2017 6300 0 2017 8400 0 Dec-31,2018 0 0 2018 6300 0