Prepaid insurance is the portion of an insurance premium that has been paid in advance and has not expired as the date of the balance sheet. It is an asset for organisation. Assets are real account.
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Q1
Classify the following accounts under personal, real or nominal accounts:
(i) Commission Paid
(ii) Commission Received
(iii) Commission Accrued
(iv) Prepaid Salaries
(v) Leasehold Property A/c
(vi) Discount Allowed
(vii) Carriage Inwards A/c
(viii) Life Insurance Corporation of India
(ix) Drawings A/c
(x) Rent Received in Advance
(xi) Debtors
(xii) Sales A/c
(xii) Rent Paid in Advance
(xiv) Bank Overdraft
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Q2
Prepaid salary account is a ___________.
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Q3
Insurance unexpired accounts is a _____________.
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Q4
Insurance unexpired account is a __________.
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Q5
Rs. 2,400, being the prepaid portion of insurance, was brought forward from the previous year as a credit balance in the nominal account. Identify the amount of the trial balance difference which will be placed in a suspense account -