The Oglethorpe Corporation reported a beginning balance of $12,400 in its Prepaid Insurance account for 2016.During the year,Oglethorpe paid a total of $42,000 to purchase insurance,and the Prepaid Insurance account had an ending balance of $13,100.What was the amount of insurance expense that Oglethorpe reported for 2016?
A)$42,000
B)$42,300
C)$42,700
D)$41,300

Question

Quizplus · Accepted Answer

To find the amount of insurance expense, we need to calculate the change in the Prepaid Insurance account during the year. The change can be calculated as follows:
Beginning balance + Insurance purchased during the year – Ending balance
= $12,400 + $42,000 - $13,100
= $41,300
Therefore, the insurance expense reported by Oglethorpe for 2016 was $41,300. Option D is the correct answer.

The Oglethorpe Corporation Reported a Beginning Balance of $12,400 in Its