What Is The Journal Entry To Adjust Prepaid Insurance. In this case, the company abc can record the prepaid insurance of $6,000 on december 18, 2020, with the journal entry below: This journal entry credits the prepaid asset account on the balance sheet, such as prepaid insurance, and debits an expense account on.
Journal entry for prepaid expenses. As you use the prepaid item, decrease your prepaid expense account and increase your actual expense account. Your journal entry reflecting the actual expense should look like this: