As the Prepaid Workers Compensation is recognized, the amount will transfer to
A) Workers Compensation Insurance Payable.
B) Workers Compensation Insurance Expense.
C) Cash.
D) Payroll Tax Expense.

Question

Quizplus · Accepted Answer

Prepaid Workers Compensation is an asset account that represents payments made in advance for workers compensation insurance. As the insurance coverage period elapses, the prepaid amount is recognized as an expense, transferring the cost from the Prepaid Workers Compensation account to the Workers Compensation Insurance Expense account, reflecting the consumption of the insurance service.

As the Prepaid Workers Compensation Is Recognized, the Amount Will