olicy for $72,000. vonce a year, on epaid Insurance-Annual Adjustments 8gs Corp. purchases a 24-month property insurance policy for $7 ive immediately. Assume that Briggs prepares adjustments only once a yea LO5 Exercise 4-10 Prepaid Insurance-Annual EXAMPLE 4-4 On April 1, 2017, Briggs Corp. purchases The policy is effective immediately. Assume that Show December 31. me how Required 1. Compute the monthly cost of the insurance policy. nuity and analyze the transaction to record the purchase of the policy on April 1, 2017 3. Identify and analyze the adjustment on December 31, 2017. Assume that the accountant forgets to record an adjustment on December 31, 2017. Will net income for the year ended December 31, 2017, be understated or overstated? Explain your