Mouse Inc. uses the alternative method of accounting for prepayments and purchased a $1,200, 6-month insurance policy. The company immediately debited the Insurance expense account. By the end of the period, $400 of the policy had expired. Demonstrate the required adjustment needed at the end of the period. Multiple choice question. Debit Prepaid insurance $800. Credit Prepaid insurance $800. Debit Prepaid insurance for $400. Debit Insurance expense $400