The total premium for each policy was paid in full (for all months) at the purchase date, and the Prepaid Insurance account was debited for the full cost. (Year-end adjusting entries for Prepaid Insurance were properly recorded in all prior years.)
|
Policy
|
Date of purchase
|
Months of coverage
|
Cost
|
|
A
|
April 1, 2013
|
24
|
$14,400
|
|
B
|
April1, 2014
|
36
|
$12,960
|
|
C
|
August 1, 2015
|
12
|
$2,400
|