1. Prepaid Insurance Entry. Company policy to capitalize and amortize insurance over $2K/year. On 4/1/21, company received a property insurance for $6,000 covering 5/1/21 to 4/30/22. Please book the journal entries for April 2021 and May 2021.
2. Fixed asset and depreciation. Company policy is to capitalize any machinery over $5K. On 3/1/21, company purchased a machinery for $24K. The machinery has 6 year life. Please book the entry for initial equipment purchase and monthly depreciation for March and April. Assume straight line depreciation with no residue value.
3. Fixed asset disposal. Using the above example. Company sold the above machine on 5/1/21 for $20,000. Please book the entry for asset disposal.
