X Company prepares annual financial statements. On September 1, 2017, X Company paid $42,000 in advance for a two-year insurance policy. After the adjusting entry on December 31, 2017, what will X Company's 2017 financial statements show? a. Prepaid Insurance, $10,500; Insurance expense, $31,500 b. Prepaid Insurance, $31,500; Insurance expense, $10,500 c. Prepaid Insurance, $7,000; Insurance expense, $35,000 d. Prepaid Insurance, $0; Insurance expense, $42,000 e. Prepaid Insurance, $35,000; Insurance expense, $7,000 f. Prepaid Insurance, $42,000; Insurance expense, $0