a-company-pays-24000-for-a-two-year-insurance-policy-how-should-the-expense-be-r

Question

A company pays $24,000 for a two-year insurance policy. How should the expense be recorded for the first year?

Accepted Answer

$12,000 should be recorded as an expense.

Answer

$6,000 should be recorded as an expense.

Answer

$24,000 should be recorded as an expense.

Answer

$0 should be recorded as an expense.

A company pays \$24,000 for a two-year insurance policy. How should the expense be recorded for the first year?