Prepaid insurance at the end of the year is shown in the statement of financial position as
Answer and explanation
Correct answer: A. a current asset
- Step 1: Prepayment is a benefit paid for in advance, so it is an asset. Answer: a current asset. Why not the others: a current liability: That is for amounts owed. an expense: It is the part not yet used up. a non-current asset: It will be used within a year.
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