Prepaid Insurance-Annual Adjustments On April 1, 2017, Briggs Corp. purchases a 24-month property insurance policy for $72,000. The policy is effective immediately. Assume that Briggs prepares adjustments only once a year, on December 31 Required: 1. Compute the monthly cost of the insurance policy $3,00 per month Consider the number of months covered by the annual premium 2. Identify and analyze the transaction to record the purchase of the policy on Apr Activity Operating Accounts Prepaid Thurance Increase, Cash Decrease Statements) Balance Sheet Only item is negative, te, a decrease be sure to enter the snow How does this entry affect the accounting equation? If a financial statement item is not affected, select "No Entry and leave the amount box Balance Sheet Stockholders' Assets Liabilities + Equity Prepaid Insurance 72,0 No Entry Cash -22, No Entry OS 19 ES . 331 2 ERI? 3. Identity and analyze the adjustment on December 31, 2017 Activity Investing Account Prepaid Inpurance Increase Insurance pense Increase Statements) Balance sheet only How does this entry the If a financial statement the accounting equation is not affected, No Entry and leave Balance Sheet ure to enter the answer with a minus 231 HIS 15 . Equity 12 l . Lates Prepaid Insurance. Insurance Expense -27, . 13 5 4. Assume that the accountant forgets to record an adjustment on December 31, 20 Overstated ar ended December 31, 2017, be understated or overstated