If unexpired insurance appears in the Trial Balance, it should be:
ACredited to the Profit & Loss Account
BShown on the liabilities side of the Balance Sheet
CShown on the assets side of the Balance Sheet
DDebited to the Profit & Loss Account
Correct answer
C. Shown on the assets side of the Balance Sheet
Explanation
Unexpired insurance or prepaid insurance must be shown on the assets side of the Balance Sheet, because it is an asset. It cannot be shown on the liabilities side of the Balance Sheet. It cannot be debited to Profit & Loss A/c. Also it cannot be credited to Profit & Loss A/c. Hence D. is true.