On January 1, Fey Properties Paid $12,600 for a Three-Year

Multiple Choice

On January 1, Fey Properties paid $12,600 for a three-year insurance premium, with coverage beginning immediately. Fey Company prepares monthly financial statements.
Which of the following describes the required adjusting entry on January 31?

A) Debit Cash for $4,200 and Credit Prepaid insurance for $4,200
B) Debit Prepaid insurance for $350 and Credit Insurance expense for $350
C) Debit Insurance expense for $350 and Credit Prepaid insurance for $350
D) Debit Cash for $8,400 and Credit Prepaid insurance for $8,400
E) Debit Insurance expense for $4,200 and Credit Prepaid insurance for $4,200