CREATE JOURNAL ENTRIES FOR THE JANUARY 2018 TRANSACTIONS BELOW FOR SUNFLOWER DESIGNS:

On January 1, a 24-month liability insurance policy was purchased to cover Sunflower Designs. The full cost of the policy, $1,800, was paid in cash on the same date.

. CREATE ADJUSTING JOURNAL ENTRIES FOR JANUARY 31, 2018:

Record the adjusting entry to record the use of the prepaid insurance coverage in January. The amount of the expired insurance coverage was $200. The previous months adjusting entries were made as required.