What is the journal entry of Life Insurance paid for employees??
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a) Upon payment of the Life Insurance:
DR Prepaid Insurance XXX
CR Cash on Hand/in Bank XXX
To record payment of life insurance.
b) For making adjusting entry as to the used insurance, shall we say by monthly or annually, the entry would be:
DR Insurance Expense XXX
CR Prepaid Insurance XXX
To record insurance used/expense during the period.
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