Question

On december 2017 coolwear had a balance in its prepaid insurance acount of 68,400. During 2018, 106,000 was paid for insurance. At the end of 2018, after adjusting entries were recorded, the balance in the prepaid insurance account was $42,000. Insurance expense recorded for 2018 would be:_____.
A. $86,000.
B. $134,400.
C. $74.400.
D. $92,400.

Answer 1

Answer:

$132,400

Explanation:

Calculation for the Insurance expense

Using this formula

Insurance expense= 2017 Ending Balance in prepaid insurance account+ Amount paid for insurance-2018 Ending Balance in prepaid insurance account

Let plug in the formula

Insurance expense=$68,400+$106,000-$42,000

Insurance expense=$132,400

Therefore the Insurance expense recorded 2018 would be $132,400