Question 8 5 pts See Question 7. At the time of the initial purchase of the insurance policy. Is this transaction an example of an "Accrued Expense or a "Deferred Expense". Briefly explain your answer. HTML Editor . BIVA-AIE* 3 - DO VE V B x x. 12pt - Paragraph - 888 ' 3 W R Question 7 3.5 pts On April 1, 2016, 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 only adjusted only at year-end. Which of the following correctly describes the effect on the financial statements of the December 31, 2016 adjusting entry? Prepaid insurance will increase $2,250, Prepaid insurance will decrease $750. Insurance expense will increase $2,250. Insurance expense will increase $750