For each separate case below, follow the three-step process for adjusting the prepaid asset account at December 31. Step 1: Determine what the current account balance equals. Step 2: Determine what the current account balance should equal. Step 3: Record the December 31 adjusting entry to get from step 1 to step 2. Assume no other adjusting entries are made during the year. a. Prepaid Insurance. The Prepaid Insurance account has a $5,900 debit balance to start the year. A review of insurance policies shows that $1,500 of unexpired Insurance remains at year-end. Step 1: Determine what the current account balance equals. Step 2: Determine what the current account balance should equal. Step 3: Record the December 31 adjusting entry to get from step 1 to step 2. Prepaid Insurance b. Prepaid Insurance. The Prepaid Insurance account has a $7,090 debit balance at the start of the year. A review of insurance policies shows $1,520 of insurance has expired by year-end. Step 1: Determine what the current account balance equals Prepaid Insurance