On April 1, 2017, the premium on a one-year insurance policy was purchased for $3,000 cash with the insurance coverage beginning on that date. The books are adjusted only at year-end. Which of the following correctly describes the effect on the financial statements of the December 31, 2016 adjusting entry?

A.	Prepaid insurance will decrease $750.

B.	Insurance expense will increase $750.

C.	Insurance expense will increase $2,250.

D.	Prepaid insurance will increase $2,250.