Problem
On May 3, it was discovered that the following errors took place in journalizing and posting transactions:
a. Insurance of $17,100 paid for the current year was recorded as a debit to Insurance Expense and a credit to Prepaid Insurance.
b. Dividends of $12,000 were recorded as a debit to Wages Expense and a credit to Cash.
Journalize the entries on May 3 to correct the errors. Use two entries to correct the error described in A. (That is, record an entry to reverse the incorrect entry and a second entry to record the correct entry.) Refer to the Chart of Accounts for exact wording of account titles.