A. All India Insurance Company received an insurance premium of Rs 50 lacs on an insurance...
A. All India Insurance Company received an insurance premium of Rs 50 lacs on an insurance policy whose coverage extends till the mid of the next accounting year.
B. Additionally, the company has a monthly salary expense of Rs 25 lacs. For the accounting year ended on March 31, 2019 the company paid 275 lacs on account of salary. The salary for the month end is paid in the first week of April 2019. Discuss the treatment of both of these payments in the books and disclosures in the financial statements, as on 31st March 2020
Homework Answers
A.
When the company receives insurance premium, unearned revenue is
credited and at end of year unearned revenue is debited by the
amount of revenue earned during the period,
Income Statement
Revenue will increase by 25 lacs i.e. 50 x 1/2
Balance Sheet
Under current liabilities
Unearned Revenue will be 25 lacs
B.
As per accrual accounting, expense for complete period is recorded
whether paid or not, Therefore salary expense will be debited by
Rs. 25 lacs and credited Salary Payable
Income Statement
Salary Expense will increase by 25 lacs
Balance sheet
Under current liabilities
Salaries payable will be 25 lacs
Add Answer to:
A. All India Insurance Company received an insurance premium of
Rs 50 lacs on an insurance...
On March 1, 2017, a company paid an $20,700 premium on a 36-month insurance policy for...
On March 1, 2017, a company paid an $20,700 premium on a 36-month insurance policy for coverage beginning on that date. Refer to that policy and fill in the blanks in the following table
On April 1, 2016, the premium on a one-year insurance policy was purchased for $2,400 cash...
On April 1, 2016, the premium on a one-year insurance policy was purchased for $2,400 cash with the insurance coverage beginning on that date. The books are adjusted only at year-end. Which of the following correctly describes the effect on the financial statements of the December 31, 2016 adjusting entry?
On April 1, 2017, the premium on a one-year insurance policy was purchased for $3,000 cash...
On April 1, 2017, the premium on a one-year insurance policy was purchased for $3,000 cash with the insurance coverage beginning on that date. The books are adjusted only at year-end. Which of the following correctly describes the effect on the financial statements of the December 31, 2016 adjusting entry? A. Prepaid insurance will decrease $750. B. Insurance expense will increase $750. C. Insurance expense will increase $2,250. D. Prepaid insurance will increase $2,250.
Accounting: On April 1, a company paid $2,400 premium for a two year policy with benefits...
Accounting: On April 1, a company paid $2,400 premium for a two
year policy with benefits beginning that day. What will be the
insurance expense on the annual income statement for the first year
ended Dec 31?
on April 1, a company paid $2,400 premium for a two year policy with benefits beginning that day. What will e the insurance expense on the annual income statement for the first year ended Dec 31? Multiple Choice $2,400 o $900 0 $200...
On June 1, 2017, a company paid an $25,200 premium on a 36-month insurance policy for...
On June 1, 2017, a company paid an $25,200 premium on a 36-month insurance policy for coverage beginning on that date. Refer to that policy and fill in the blanks in the following table. I need the values for X in the table below: Balance Sheet Income Statement Prepaid Insurance Insurance Expense Accrual Basis Cash Basis Accrual Basis Cash Basis Dec. 31, 2017 X $0 2017 X $25,200 Dec. 31, 2018 X 0 2018 X 0 Dec. 31, 2019 X...
Q.19 An auto insurance company wants to predict client claims from the amount of premium paid...
Q.19 An auto insurance company wants to predict client claims from the amount of premium paid on each policy. Which of the following variables should be the explanatory variable in such a study? a. Amount of claim b. Deductible c. Limits per coverage d. Policy premium e. Insufficient information
On July 1, 2015, a company paid an $18,900 premium on a 36-month insurance policy for...
On July 1, 2015, a company paid an $18,900 premium on a 36-month insurance policy for coverage beginning on that date. Refer to that policy and fill in the blanks in the following table. Income Statement Insurance Expense Accrual Basis Cash Basis Cash Basis Balance Sheet Prepaid Insurance Accrual Basis Dec 31, 2015 Dec. 31, 2016 Dec. 31, 2017 Dec. 31, 2018 2015 2016 2017 2018 Total
On February 1, 2015, a company paid an $18,900 premium on a 36-month insurance policy for...
On February 1, 2015, a company paid an $18,900 premium on a 36-month insurance policy for coverage beginning on that date. Refer to that policy and fill in the blanks in the following table. Income Statement Insurance Expense Accrual Basis Cash Basis Balance Sheet Prepaid Insurance Accrual Basis Cash Basis Dec. 31, 2015 Dec. 31, 2016 Dec. 31, 2017 Dec. 31, 2018 2015 2016 2017 2018 Total 0 $
Corbin's Café received a bill from the electric company for electricity used. The bill is for...
Corbin's Café received a bill from the electric company for electricity used. The bill is for $325 and has not been paid yet. What adjusting entry would Corbin's Café make? Account Titles and Explanation Debit Credit On February 1, 2019 Kelly Company purchased a 1 year insurance policy for $1,200. What is the adjusting entry on March 31st? Account Titles and Explanation Debit Credit
6. On February 1, 2019 Kelly Company purchased a 1 year insurance policy for $1,200. What is the adjusting entry on Mar...
6. On February 1, 2019 Kelly Company purchased a 1 year insurance policy for $1,200. What is the adjusting entry on March 31st? Account Titles and Explanation Debit Credit
Accounting: On April 1, a company paid $2,400 premium for a two
year policy with benefits beginning that day. What will be the
insurance expense on the annual income statement for the first year
ended Dec 31?
on April 1, a company paid $2,400 premium for a two year policy with benefits beginning that day. What will e the insurance expense on the annual income statement for the first year ended Dec 31? Multiple Choice $2,400 o $900 0 $200...
On July 1, 2015, a company paid an $18,900 premium on a 36-month insurance policy for coverage beginning on that date. Refer to that policy and fill in the blanks in the following table. Income Statement Insurance Expense Accrual Basis Cash Basis Cash Basis Balance Sheet Prepaid Insurance Accrual Basis Dec 31, 2015 Dec. 31, 2016 Dec. 31, 2017 Dec. 31, 2018 2015 2016 2017 2018 Total
On February 1, 2015, a company paid an $18,900 premium on a 36-month insurance policy for coverage beginning on that date. Refer to that policy and fill in the blanks in the following table. Income Statement Insurance Expense Accrual Basis Cash Basis Balance Sheet Prepaid Insurance Accrual Basis Cash Basis Dec. 31, 2015 Dec. 31, 2016 Dec. 31, 2017 Dec. 31, 2018 2015 2016 2017 2018 Total 0 $
Corbin's Café received a bill from the electric company for electricity used. The bill is for $325 and has not been paid yet. What adjusting entry would Corbin's Café make? Account Titles and Explanation Debit Credit On February 1, 2019 Kelly Company purchased a 1 year insurance policy for $1,200. What is the adjusting entry on March 31st? Account Titles and Explanation Debit Credit
6. On February 1, 2019 Kelly Company purchased a 1 year insurance policy for $1,200. What is the adjusting entry on March 31st? Account Titles and Explanation Debit Credit
Most questions answered within 3 hours.
-
Where is the error in this code sequence?
String s1 = "Hello";
String s2 = "ello";...
asked 11 months ago -
Financial data for Joel de Paris, Inc., for last year
follow:
Joel de Paris, Inc.
Balance...
asked 11 months ago -
Consider this reaction:
Al2(SO4)3 (aq)+ BaCl3
(aq) Al2Cl6 (aq)- +
3BaSO4(s) . What is the...
asked 11 months ago -
Suppose that Savneet is considering increasing her
recent random sample from 20 car rentals to 40...
asked 11 months ago -
Trucks arrive at an unloading terminal at an average rate of 120
per hour.
Trucks arrive...
asked 11 months ago -
Why are methanol and ethanol completely soluble in water while
octanol is not very little soluble....
asked 11 months ago -
A facilities manager at a university reads in a research report
that the mean amount of...
asked 11 months ago -
When the CuSO4 is rehydrated by adding water to the anhydrous
compound, is this an endothermic...
asked 11 months ago -
A ray of sunlight is passing from diamond into crown glass; the
angle of incidence is...
asked 11 months ago -
A block of mass 0.249 kg is placed on top of a light, vertical
spring of...
asked 11 months ago -
how do the kidneys compensate in the presences of acidosis
a) trigger hyperventilate
b) reserve acid...
asked 11 months ago -
Question 501 pts
The rental rate of capital to the firm increases. Which of the
following...
asked 11 months ago