Debit the prepaid account, in this case prepaid insurance, for five months of the premium. For example, a six-month premium of $450 would equal $75 per month, or $375 for five months.

Insurance as a Prepaid Expense . One of the more common forms of prepaid expenses is insurance, ... Then, after a month, the company makes an adjusting entry for the insurance used.

Adjusting Journal Entry Details. Adjusting journal entries are made in the general ledger of a company at the end of an accounting period. A general ledger is record-keeping system companies use ...

Enter salary accruals as adjusting entries in the accounting journal. Specifically, record salary accruals of $12,000 for the month as a debit under the accounting period date, such as Jan. 31.

Peter Gratton, M.A.P.P., Ph.D., is a New Orleans-based editor and professor with over 20 years of experience in investing, risk management, and public policy. Peter began covering markets at ...