X Company prepares annual financial statements. On May 1, 2019, the Company paid $42,000 in advance for a two-year insurance policy. After the adjusting entry on December 31, 2019, what will X Company's 2019 financial statements show?

a.Prepaid Insurance, $36,750; Insurance expense, $5,250

b.Prepaid Insurance, $42,000; Insurance expense, $0

c.Prepaid Insurance, $28,000; Insurance expense, $14,000

d.Prepaid Insurance, $5,250; Insurance expense, $36,750

e.Prepaid Insurance, $14,000; Insurance expense, $28,000

f.Prepaid Insurance, $0; Insurance expense, $42,000