Question - How do you calculate prepaid insurance as well as interest receivable?
On March 1, 2018 the company lent a supplier $20,000 and a note was signed requiring principle and interest at 8% to be paid on February 28, 2019.
On April 1, 2018, the company paid an insurance company $6,000 for a 2 year fire insurance policy. The entire $6,000 was debited to insurance expense.