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Answered

for the following transaction, answer the questions that follow in accordance with the rules of journalizing and the double-entry accounting system: transaction: walker company received $6,400 payment from a customer on account.

Answer :

Following Adjustments are being shown below.

Which two accounts are affected ?

  • Prepaid insurance

What kind of accounts are they?

  • Current asset

Do the account balances increase or decrease?

  • Increase

Do we debit or credit the accounts?

  • Debit

Since insurance is paid in advance for the upcoming six months, the account that will be debited will be a prepaid insurance account.

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