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Question 37 (5 points) ABC corporation purchases an insurance policy for $3,600 that will provide...

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Question 37 (5 points) ABC corporation purchases an insurance policy for $3,600 that will provide coverage for 1 year and pays for it in cash on November 1, 2019 which is also the day that coverage begins. This is appropriately recorded as an asset when it was paid. On December 31, 2019 the appropriate adjusting entry for this policy (assuming no other entries have been made for the policy since November 1) will be: Debit Insurance Expense $300 credit Prepaid Insurance $300 Debit Insurance Expense $600 credit Prepaid Insurance $600 Debit Prepaid Insurance $600 credit Cash $600 Debit Prepaid Insurance $300 credit Insurance Expense $300 Question 38 (5 points) The Magic Trick Company (MTC) has inventory that consists of the following items on December 31: Item Cost Number on Normal Sales Hand Price Card Tricks 4 $ 5 0 $7.95 Magic Hat BE72 $12.95 If MTC has marked down the card tricks to $2 each and still has not sold the 50 units, the needed entry to record lower of cost or market for card tricks includes O A debit to inventory for $100 A credit to inventory for $200 A debit to Cost of Goods Sold for $100 No entry because they haven't been sold yet

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