7. The prepaid insurance account has a $8,000 beginning balance. Additional insurance premiums in the amount of $12,000 were paid during the year. At year-end, there is $3,000 of insurance coverage remaining. The entry needed to adjust the account is:

A. Prepaid Insurance 12,000

Cash 12,000

B. Insurance Expense 17,000

Prepaid Insurance 17,000

C. Insurance Expense 3,000

Prepaid Insurance 3,000

D. Prepaid Insurance 17,000

Insurance Expense 17,000

8. Speedy Accounting Services agreed to perform services for a client at a rate of $4,000 per month. A six-month prepayment was made in advance on October 1, 2019 and services began on that date. December 31, 2019 is the end of Speedys accounting year. What is the October 1, 2019 entry to record the prepayment?

A. Cash 4,000

Unearned Revenue 4,000

B. Unearned Revenue 12,000

Service Revenue 12,000

C. Unearned Revenue 24,000

Cash 24,000

D. Cash 24,000

Unearned Revenue 24,000

9. Refer to Question 8. What is the entry to make the necessary adjustment on December 31, 2019? (Speedy Accounting adjusts their books only at the end of the year.)

A. Unearned Revenue 12,000

Service Revenue 12,000

B. Unearned Revenue 12,000

Cash 12,000

C. Unearned Revenue 4,000

Service Revenue 4,000

D. Service Revenue 12,000

Unearned Revenue 12,000

Thank you for your help, please explain how you got to your answers.