b. On January 1 of the current year, Laughter purchases an insurance policy that covers two years, $8,000. (When the policy was purchased on January 1, assume that Laughter debited an asset account.) 4 Accounts and Explanation Debit Date Dec. 31 Credit

b. On January 1 of the current year, Laughter purchases an insurance policy that covers two years, $8,000. (When the policy was purchased on January 1 , assume that Laughter debited an asset account.) b. On January 1 of the current year, Laughter purchases an insurance policy that covers two years, $8,000. (When the policy was purchased on January 1 , assume that Laughter debited an asset account.)