On July 1 of the current calendar year, Plum Co. paid $7,500 cash for management services to be performed over a two-year period beginning July 1. Plum follows a policy of recording all prepaid...

Extracted text: On July 1 of the current calendar year, Plum Co. paid $7,500 cash for management services to be performed over a two-year period beginning July 1. Plum follows a policy of recording all prepaid expenses to asset accounts at the time of cash payment. The adjusting entry on December 31 of :the current year for Plum would include :Select one a. A debit to an expense and a credit to a O prepaid expense for $5,625 b. A debit to a prepaid expense and a credit O .to Cash for $5,625 C. A debit to an expense and a credit to a O .prepaid expense for $1,875 d. A debit to a prepaid expense and a credit O .to an expense for $1,875