3) Question:

On July 1, 2010, Spahn Co. pays $18,000 to Randle Insurance Co. for a 3-year insurance contract. Both companies have fiscal years ending December 31. For Spahn Co., journalize and post the entry on July 1 and the adjusting entry on December 31, and post to ledger and find balances.

2) Case Study: Safeen believes expenses from credit purchases may be inccured before they are paid in cash. As an accountant, write a letter to Safeen explaining that her believe is correct when she adopt the accrual basis of accounting