Fire insurance premiums paid in the previous year that


Left Balance sheet

Cash 2'833

Receivables 11'946

Inventories 8'885

Property, plant and equipment 20'114

Other assets 56'912

Total 100'690

Right balance sheet

Accounts payable 11'137

Othe rliabilites 37'081

Owners' equity 52'472

Total 100'690

Transactions

1- Inventory with cost of 500 were sold for 350 & on open account of 400, for a grand total of 750

2- Collect receivables of 620

3- Depreciation expense of 30 was recognized

4- Selling and administrive expenses of 240 were paid in cash

5- Prepaid expenses of 50 expired. these included fire insurance premiums paid in the previous year that applied to future months. the expiration increases selling and administration expenses and reduces other assets

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Accounting Basics: Fire insurance premiums paid in the previous year that
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