Scully Corporation Purchased a Three-Year Insurance Policy on November 1

Multiple Choice

Scully Corporation purchased a three-year insurance policy on November 1 for $3,600. Assuming that Scully Corporation recorded the original transaction by debiting Prepaid Insurance, the adjusting entry on December 31 will include a

A) Debit to Insurance Expense for $200
B) Credit to Prepaid Insurance for $100
C) Debit to Prepaid Insurance for $100
D) Credit to Cash for $200