Question
how would i do this question: Kreative Kitchens purchased a 1-year insurance policy on 1 March 2017. The entrie premium of $9000 was recorded by
how would i do this question:
Kreative Kitchens purchased a 1-year insurance policy on 1 March 2017. The entrie premium of $9000 was recorded by debiting Prepaid Insurance. Ignore GST.
a. give the adjusting entry at 30 june for the year ending 30 june 2017
b. what amount should be reported in the 30 june 2017 balance sheet for Prepaid insurance?
c. if no adjusting entry were made on june 30, by how much would profit be overstated or understated? would assets be overstated or understated? explain
d. what would your adjusting entry in requirement A be if the premium of $9000 was recorded by debiting Insurance Expenses?
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