O-LevelAccountingPreparation of financial statements7707/13 · Oct/Nov 2020 · Q141 Mark
At the end of his financial year on 31 August 2020 a trader had prepaid insurance. How will this appear in the insurance account and the statement of financial position at 31 August 2020?
Ainsurance account: credit balance carried down, statement of financial position: current asset
Binsurance account: credit balance carried down, statement of financial position: current liability
Cinsurance account: debit balance carried down, statement of financial position: current asset
Dinsurance account: debit balance carried down, statement of financial position: current liability
✓ Correct answer
A: insurance account: credit balance carried down, statement of financial position: current asset
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