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On June 1, 20X0, your company takes out a 1-year insurance policy for $3,600 and prepays the entire amount, recording it as an asset. At
- On June 1, 20X0, your company takes out a 1-year insurance policy for $3,600 and prepays the entire amount, recording it as an asset. At year-end 20X0, you discover an adjusting entry that records one years insurance expense of $1,800.
- What is the correcting journal entry?
- If no correcting journal entry is recorded, how are the 20X0 income statement and balance sheet, respectively, affected?
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