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On January 1, a company purchased a five-year insurance policy for $36,000 with coverage starting...

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Accounting

On January 1, a company purchased a five-year insurance policy for $36,000 with coverage starting immediately. The adjusting entry at the end of the first year is:Select one:a. Debit Prepayments, $7,200; credit Insurance Expense, $7,200.b. Debit Insurance Expense, $28,800; credit Prepayments, $28,800.c. Debit Prepayments, $28,800; credit Insurance Expense, $28,800.d. Debit Insurance Expense, $7,200; credit Prepayments, $14,400.

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