Which of the following statements is true? Debits increase assets and decrease liabilities. Credits decrease assets and decrease liabilities. Credits increase assets and increase liabilities. Debits decrease liabilities and increase assets. On July 1 X company purchased a 6 month insurance policy for $1, 200 and recorded it as a debit to prepaid insurance. At the end of July, to record insurance expense, X Company should _________________: Debit Insurance Expense, $1, 200; Credit Prepaid Insurance, $1, 200. Debit Prepaid Insurance, $200; Credit Insurance Expense, $200. Debit Insurance Expense, $200; Credit Prepaid Insurance, $2000. Debit Insurance Expense, $1, 200; Credit Prepaid Insurance, $1, 200. Which of the following accounts is increased with a debit? Insurance expense Accounts payable revenue Allowance for Doubtful Accounts Common Stock