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The premium on a three-year insurance policy expiring on December 31, 2011, was paid in total on January 2, 2009.

<p><em><strong>If the company has a6-month operating cycle, then on December31,2009, the prepaid insurance reported on the balance sheet as a current asset would be for:</strong></em></p> <p><em><strong>a)6 months.</strong></em></p> <p><em><strong>b)12 months.</strong></em></p> <p><em><strong>c)18 months.</strong></em></p> <p><em><strong>d)24 months.</strong></em></p> <p> </p> <p><em><strong>CPA Adapted</strong></em></p>

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Question added by Deleted user
Date Posted: 2014/10/11
James Perez, CPA, CMA Candidate
by James Perez, CPA, CMA Candidate , Assistant Manager-Financial Planning and Analysis , Tupperware Brands Philippines

D.24 months (36 months less12 months). The operating cycle may be irrelevant.

Deleted user
by Deleted user

Answer B is correct 

 

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