Williams Company Paid $24,000 for a Two-Year Insurance Policy on October

Multiple Choice

Williams Company paid $24,000 for a two-year insurance policy on October 1 and recorded the $24,000 as a debit to Prepaid Insurance and a credit to Cash.
What adjusting entry should Williams make on December 31, the end of the accounting period (no previous adjustment has been made) ?

A) Prepaid Insurance 3,000
Insurance Expense 3,000
B) Insurance Expense 12,000
Prepaid Insurance 12,000
C) Prepaid Insurance 21,000
Insurance Expense 21,000
D) Insurance Expense 3,000
Prepaid Insurance 3,000
E) None of the above