Assume Idaho Company recorded the following adjusting entry at year-end:
Insurance expenses$2,000
Prepaid insurance $2,000
If the beginning balance in prepaid insurance was $500 and $2,500 was paid for an insurance premium during the year, the ending balance in the prepaid insurance account (after the above adjusting entry) would be:
a. $1,200 debit.
b. $700 debit.
c. $2,200 debit.
d. $1,000 debit.