Question
Below are two unrelated situations pertaining to life insurance. Ford Corporation owns a whole life insurance policy on the life of its president. Ford Corporation
Below are two unrelated situations pertaining to life insurance.
- Ford Corporation owns a whole life insurance policy on the life of its president. Ford Corporation is the beneficiary. The insurance premium is $29,000. The cash surrender value increased during the year from $3,300 to $6,200.
- Petroleum Corporation received a $330,000 life insurance settlement when its CEO died. At that time, the cash surrender value was $20,000.
Required: Prepare the appropriate journal entry for each situation. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
1. Ford Corporation owns a whole life insurance policy on the life of its president. The annual premium is $29,000. The cash surrender value increased during the year from $3,300 to $6,200.
2. Petroleum Corporation received a $330,000 life insurance settlement when its CEO died. At that time, the cash surrender value was $20,000.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access with AI-Powered Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started
Intermediate Accounting
Authors: J. David Spiceland, James Sepe, Mark Nelson
6th edition
978-0077328894, 71313974, 9780077395810, 77328892, 9780071313971, 77395816, 978-0077400163
