On Oct 1, 2016, a firm purchased a 1-year insurance policy for $2,400 and paid the full premium in advance. The adjustment needed on December 31, 2016, to report the amount of insurance that had expired, would be:

a debit to Prepaid Insurance for $600 and a credit to Insurance Expense for $600.

a debit to Insurance Expense for $600 and a credit to Prepaid Insurance for $600.

a debit to Insurance Expense for $2,400 and a credit to Cash for $2,400.

a debit to Insurance Expense for $1,800 and a credit to Prepaid Insurance for $1,800