Asked by Derek Lewis on Apr 25, 2024
Prepaid insurance is reported on the balance sheet as a
A) current asset
B) fixed asset
C) current liability
D) long-term liability
Prepaid Insurance
An asset account that reflects insurance premiums paid in advance, which are expensed as the insurance coverage periods expire.
Current Asset
An asset on the company's balance sheet that is expected to be converted into cash within one year of the reporting date.
- Distinguish between current assets, fixed assets, current liabilities, and long-term liabilities on the balance sheet.
Learning Objectives
- Distinguish between current assets, fixed assets, current liabilities, and long-term liabilities on the balance sheet.