Question

Qwerty, Inc. prepaid $ 3 comma 600 on October​ 1, 2014 for a one minus year insurance premium. On January​ 1, 2015 of the next year​ (after December 31​ adjustments), the Prepaid Insurance account will have a debit balance of​ ________. (Round any intermediate calculations to two decimal​ places, and your final answer to the nearest whole​ number.)

Answer 1

qwerty

Step-by-step explanation:

Answer 2

The Prepaid Insurance account will have a debit balance of​ $2,700

Step-by-step explanation:

The computation of the balance of prepaid insurance is shown below:

On October 1, 2014, its balance is $3,600

And we have to compute till January 1, 2015

So, if we calculate from October 1, 2014, to January 1, 2015, then it has 3 months

So, 3-month balance equals to

= Amount × (number of months calculated ÷ total number of months in a year)

= $3,600 × (3 months ÷ 12 months)

= $900

So, the balance would be

= Amount - adjustments made

= $3,600 - $900

= $2,700