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The Trial Balance for Greenway Corporation Appears as Follows \begin{array}{lrr}\end{array}

Question 159

Multiple Choice

The trial balance for Greenway Corporation appears as follows:
\begin{array}{lrr}\end{array}

  Greenway Corporation   Trial Balance  December 31,2014  Cash .................................................................$300 Accounts Receivable ........................................500 Prepaid Insurance ...........................................60 Supplies ........................................................140 Equipment .......................4,000 Accumulated Depreciation, Equipment .........$800 Accounts Payable ........................................300 Common Stock..............................................1,000 Retained Earnings ..........................................1,400 Service Revenue ..........................................3,000 Salaries and Wages Expense .......................1,000 Rent Expense ..............................................500  $6,500$6,500\begin{array}{lrr}& \text{ \textbf{ Greenway Corporation }\ } \\& \text{ Trial Balance}\\ &\text{ \underline{\text{ December 31,2014}} } \\\\ \text{ Cash } .................................................................& \$ 300 & \\\text{ Accounts Receivable } ........................................ & 500 & \\\text{ Prepaid Insurance } ........................................... & 60 & \\\text{ Supplies } ........................................................ & 140 & \\\text{ Equipment } ....................... & 4,000 & \\\text{ Accumulated Depreciation, Equipment }......... & & \$ 800 \\\text{ Accounts Payable } ........................................ & & 300 \\\text{ Common Stock} ..............................................& & 1,000 \\\text{ Retained Earnings }.......................................... & & 1,400 \\\text{ Service Revenue } .......................................... & & 3,000 \\\text{ Salaries and Wages Expense } .......................& 1,000 & \\\text{ Rent Expense } ..............................................& \underline{\text{500 }} & \underline{\text{0 }} \\\text{ } & \$6,500 & \$6,500 \\ \end{array}
If, on December 31, 2014, the insurance still unexpired amounted to $10, the adjusting entry would contain a:


A) debit to Prepaid Insurance for $50.
B) credit to Prepaid Insurance for $10.
C) debit to Insurance Expense for $50.
D) debit to Prepaid Insurance for $10.

Correct Answer:

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