Cash Surrender Value of Life Insurance
Response to the following problem:
On January 1, 2009, Kehoe Corporation insured the lives of its president, vice president, controller, and treasurer for $100,000 each. The annual premium on each policy is $4,200, payable on January 1 of each year, and the cash surrender values for the policies increase by 4% of the annual premiums paid. Premium payments were made on the scheduled date by the Kehoe Corporation through 2011, and the following dividends were received at the end of the year on each policy: 2009, $450; 2010, $575; 2011, $550. On February 1, 2012 the treasurer died and Kehoe Corporation collected the face value of his policy plus 11 months' premium.
Required
Prepare journal entries to record the preceding information for the years 2009 through 2012. (Round calculations to the nearest dollar.)