12 At 1 July 2004 a company had prepaid insurance of $8,200. On 1 January 2005 the company
12 At 1 July 2004 a company had prepaid insurance of $8,200. On 1 January 2005 the company paid $38,000 for
insurance for the year to 30 September 2005.
What figures should appear for insurance in the company’s financial statements for the year ended 30 June
2005?
Income statement Balance sheet
A $27,200 Prepayment $19,000
B $39,300 Prepayment $9,500
C $36,700 Prepayment $9,500
D $55,700 Prepayment $9,500
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