Author Question: Which of the following should notbe considered cash by an accountant? a. money orders b. bank ... (Read 47 times)

ssal · **on:** Jul 5, 2018

Which of the following should notbe considered cash by an accountant?
a. money orders
b. bank checking accounts
c. postage stamps
d. travelers' checks

Question 2

Sure Safe, Inc had prepaid insurance of 1,600 on January 1, 2011 from a 12-month insurance policy purchased on March 1, 2010 for 9,600. On March 1, 2011, the company bought more insurance coverage by paying 10,800 for a new one-year policy.

The company's year ends on December 31, 2011 and all adjustments for the whole year are made on that date. What amount should appear on the December 31, 2011 balance sheet as prepaid insurance? What amount of insurance expense should be reported on the income statement for the year ended December 31, 2011?
What will be an ideal response?

tranoy · **Reply #1 on:** Jul 5, 2018

Answer to Question 1

c

Answer to Question 2

Prepaid insurance at Dec 31, 2011: 1,800 = (10,800/12) x 2
Insurance expense for the year: 10,600 = 1,600 + (10 x 900)