At December 31, the unadjusted trial balance of H&R Tacks reports Prepaid Insurance of $8,160 and Insurance Expense of $0. The insurance was purchased on July 1 and provides coverage for 24 months.

Required:

1. Prepare the adjusting journal entry on December 31.

2. Prepare the T-accounts for each account, enter the unadjusted balances, post the adjusting journal entry, and report the adjusted balance.

Prepare the adjusting journal entry on December 31. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.) View transaction list Journal entry worksheet