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On August 1 , 2 0 2 5 , Yellow Company paid $ 6 , 3 2 0 for a three - year insurance policy.

On August 1,2025, Yellow Company paid $6,320 for a three-year insurance policy. On that date, an expense account was charged. In the adjusting entry on December 31,2025, there would be a
a. debit to Insurance Expense for $175.
b. credit to Prepaid Insurance for $2,107.
c. credit to Prepaid Insurance for $527.
d. credit to Insurance Expense for $5,442.
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