978133727230 978133727230 978133727230 Show Me How SolutionA

Solution

Adjusting entry for Transfer of Insurance expense from Prepaid insurance is as follows :-

Insurance expense. Dr $ 15,500

To Prepaid insurance. $ 15,500

Since prepaid account is debited when the insurance is paid, to an extent of insurance period is expired we need to transfer to insurance expense. So above adjusting entry was posted for the same.