Q3-53. On April 1, 20X7, Royal Insurance Company sold a one-year insurance policy covering the year ended April 1, 20X8. Royal collected the full $3,200 on April 1, 20X7. Royal made the following journal entry to record the receipt of cash in advance:

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A1 A D 12 2 Date Journal Entry Accounts Debit Credit 3 Apr. 1 Cash 3,200 5 45 Unearned Revenue 3,200 Nine months have passed, and Royal has made no adjusting entries. Based on these facts, the adjusting entry needed by Royal at December 31, 20X7, is: A1 A C D 123 a. Unearned Revenue 2,400 Insurance Revenue 2,400 b. Insurance Revenue 800 4 Unearned Revenue 800 5698 a 9 C. Unearned Revenue 800 Insurance Revenue 800 7 d. Insurance Revenue 2,400 Unearned Revenue 2,400