In January of the current calendar fiscal year, a company paid $36,000 for insurance coverage for the next three years. After the first ten months of the insurance policy have lapsed, all of the following are true except:

Question 24 options:

	Insurance Expense will have a debit balance of $10,000
	The monthly entry to record insurance expense will include a $1,000 credit to Prepaid Insurance
	Prepaid Insurance will have a debit balance of $26,000
	The year to date impact on the Balance Sheet will include a $10,000 reduction to Equity
	The monthly entry to record insurance expense will include a $1,000 credit to Insurance Expense