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Problem 1: Enron Ltd's Prepaid Insurance account shows a balance of $3000, representing a two-year insurance premium paid on 1 February 2020. After recording the adjustment on 30 June 2020, the end of the accounting period:
Select one:
A Insurance expense in the income statement is $3000 and Prepaid Insurance in the balance sheet is $0.B Insurance expense in the income statement is $625 and Prepaid Insurance in the balance sheet is $2375.C Insurance expense in the income statement is $2375 and Prepaid Insurance in the balance sheet is $625.D Insurance expense in the income statement is $750 and Prepaid Insurance in the balance sheet is $2250.
Financial Statement Analysis and Preparation
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