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Sally company was started on January 1, 2009. During its first week of business, the company paid $2700 for 36 months worth of fire insurance within an effective date of January 1, 2009. When Sally company prepares it's financial statements for the year ended December 31, 2009, how much prepaid insurance will be shown on the balance sheet, And how much insurance expense will be shown on the income statement? Is the needed adjustment at year end related to an Acura or deferral?
Select the formula you will use to calculate the prepaid insurance balance at December 31, 2009. Then enter the amounts and calculate the balance. Round your answer to the nearest whole number.
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