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Snowden Company Purchased a 2 Year Insurance Policy on March

Question 138

Multiple Choice

Snowden Company purchased a 2 year insurance policy on March 31 for $6,000 and charged the entire amount to Insurance Expense.The adjusting entry on December 31 will include ________.


A) a credit to Insurance Expense for $3,750
B) a credit to Prepaid Insurance for $3,750
C) a debit to Insurance Expense for $2,250
D) a credit to Cash for $2,250

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