On January 2, 2011, National Credit and Cash Purchased a General

On January 2, 2011, National Credit and Cash purchased a general liability insurance policy for $£ 3,600$ for coverage for the calendar year. The entire $£ 3,600$ was charged to Insurance Expense on January 2, 2011. If the firm prepares monthly financial statements, the proper adjusting entry on January 31, 2011, will be:

A) $\begin{array} { l }\text { Insurance Expense }&3,300 \\ \text {Prepaid Insurance }&&3,300 \\\end{array}$

B) $\begin{array} { l }\text { Prepaid Insurance. }&3,300 \\ \text {Insurance Expense}&&3,300 \\\end{array}$

C) $\begin{array} { l }\text { Insurance Expense }&300 \\ \text {Prepaid Insurance }&&300 \\\end{array}$

D) $\begin{array} { l } \text { Prepaid Insurance. }&300 \\ \text { Insurance Expense}&&300 \\\end{array}$