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Rather, they are classified as current assets, readily available for use when the company needs them. Many startups and smaller entities start with cash-basis accounting, where prepaids are expensed as paid. However, transitioning to accrual-basis accounting is often necessary as a business matures to gain more reliable financial insights, but it requires a shift in mindset. Proper classification and amortization of prepaid expenses are essential to maintaining compliance with GAAP and ensuring transparency.

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The question of whether prepaid insurance is classified as an asset is a fundamental concept in accounting and financial reporting. Prepaid insurance refers to the payment made in advance for insurance coverage that extends beyond the current accounting period. According to generally accepted accounting principles (GAAP), prepaid insurance is indeed considered a current asset, as it represents a valuable resource that will provide future benefits to the company. It represents an advance payment made by a company for contribution margin insurance coverage that has not yet been used. This expense is recorded as an asset on the balance sheet because it provides future economic benefits. Over time, as the insurance coverage period passes, the prepaid amount is gradually expensed.

Common Reasons for Prepaid Expenses

A business may purchase a one-year liability insurance policy and pay the premium upfront. Prepaid insurance is recorded in the general ledger as a prepaid asset under current assets. A current asset is a financial resource that can be easily liquidated, or converted to cash, in a year or less. In contrast, a non-current or fixed asset, like real estate, cannot be easily liquidated in a year or less. In the world of finance and accounting, the classification of insurance payments can be a perplexing topic.

Why Is Prepaid Insurance An Asset?

This is usually paid yearly, but some insurance companies allow customers to pay premiums for multiple years. Prepaid insurance is recorded as an asset on the balance sheet because it represents a service (insurance protection) that will be consumed in the future. It is a current asset, and the insurance premium related to each accounting period is expensed in that period. The accounting treatment of prepaid insurance is important for accurately reflecting the value of the policy over time and how paying upfront affects the finances of the business from month to month. Adjusting journal entries are then made each month to record the current month’s expense on the income statement and reduce the value of the unexpired amount of the prepaid insurance in the asset account. This ensures that the asset value of the prepaid insurance is reduced to zero at the end of the prepaid period, while the expense reaches the total prepaid amount.

Adjusting Entries for Prepaid Expenses

When a business pays the premium, the total premium paid is recorded on the balance sheet as a debit to the prepaid insurance account (an asset account). This is because the payment represents a future benefit, the insurance protection that has not yet been used. A prepaid expense is a type of asset on the balance sheet that results from a business making advanced payments for goods or services to be received in the future. Prepaid expenses are initially recorded as assets, but their value is expensed over time onto the income statement.

When the insurance is used up over time:

Navigating the field of business insurance can feel overwhelming, especially if you are unfamiliar with prepaid insurance. Luckily, learning the basics and looking closely at your needs can make this easier. Credit ratings from agencies like Moody’s or Standard & Poor’s can provide insights into a company’s financial stability. For a deeper dive, check out official accounting standards guides or use accounting software with templates for recurring entries. Looking at financial statement examples from public companies can also offer a masterclass in how the pros handle it.

For a complete view of how these entries come together, an amortization schedule is shown below outlining how the prepaid asset balance is reduced, or amortized, throughout the term of the policy. Prepaid insurance is important because a business should correctly record all of its transactions and resources to have accurate financial statements. Recording prepaid insurance transactions might look hard initially, but you can make it easier with a clear plan. The main idea is to treat it as an asset at first and then slowly recognize its cost as time passes. First, examine your business’s risk profiles closely to determine where weaknesses may exist and what types of coverage are appropriate. These technical challenges require careful monitoring to maintain accurate financial reporting during inflationary periods.

Amortization Process: How prepaid insurance is amortized over the coverage period

One of the best ways to estimate potential losses and develop an appropriate insurance policy is through prepaid insurance. Prepaid insurance allows companies to pay upfront for coverage without having to wait for claims. By paying up front, companies are able to budget more effectively and eliminate some uncertainty related to when they will receive payments from insurers following a claimable event. This dual-entry approach ensures that the increase in prepaid insurance (an asset) is balanced by a corresponding decrease in cash (an asset), maintaining the equilibrium of the accounting equation. As time progresses and a portion of the prepaid insurance is consumed, adjusting entries are made.

• However, prepaid advertising may be expensed when the campaign runs, regardless of the payment timing.
• Insurance policies, on the other hand, provide a form of protection against financial loss.
• Understanding the classification of prepaid insurance as an asset is vital for maintaining accurate financial records and ensuring compliance with accounting principles.
• This is particularly crucial for stakeholders, such as investors and creditors, who rely on these statements to assess a company’s ability to meet its obligations.

Prepaid insurance is categorized as a type of prepaid expense, where the payment is made upfront before the services are actually utilized. When prepaid insurance is obtained, the coverage period typically extends into the future, creating a scenario where the insurance contract is not immediately effective. To is prepaid insurance an asset illustrate, consider the case of auto insurance companies that operate on prepayment schedules.

Is prepaid insurance considered an asset or liability?

Generally, https://ajr.eng.br/2021/07/16/ultimate-guide-to-mastering-audit-trails-explore/ companies purchase a lump sum of coverage in exchange for reduced premiums over time. This form of insurance serves to cover any potential losses incurred by a company due to circumstances beyond its control such as accidents or liability claims. One potential advantage to prepaid insurance is cost savings due to volume discounts.

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Chinese Fusion Reactor Achieves Plasma Density Previously Thought to Be Impossible

In everyday language, “density-free” can sound like marketing. When density hits a wall, reactor concepts face tradeoffs. It can directly support higher fusion power, because more fuel particles can interact per unit volume under the right conditions. Below, we’ll unpack what actually changed, how EAST reached this new regime, and what it could mean for the next phase of fusion design. The team published the work in Science Advances on January 1, 2026, which puts it on the peer-reviewed record and in front of the wider fusion community.

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Google expanded YouTube’s business model from generating revenue through advertisements alone to offering paid content such as movies and exclusive content explicitly produced for YouTube. SpaceEyeNews delivers real-time news, expert analysis, and in-depth stories that matter. Still, fusion progress often arrives when a “given” becomes optional. EAST did not just inch closer to the density limit.

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Whereas YouTube’s inherent ability to allow presidents to directly connect with average citizens was noted, the YouTube content creators’ new media savvy was perceived necessary to better cope with the website’s distracting content and fickle audience. President Obama held a meeting at the White House with leading YouTube content creators not only to promote awareness of Obamacare but more generally to develop ways for government to better connect with the “YouTube Generation”. Senate introduced a resolution condemning Joseph Kony 16 days after the “Kony 2012” video was posted to YouTube, with resolution co-sponsor Senator Lindsey Graham remarking that the video “will do more to lead to (Kony’s) demise than all other action combined.” YouTube has enabled people to more directly engage with government, such as in the CNN/YouTube presidential debates (2007) in which ordinary people submitted questions to U.S. presidential candidates via YouTube video, with a techPresident co-founder saying that Internet video was changing the political landscape. The study also concluded that YouTube was becoming an important platform by which people acquire news.

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• In May 2013, Nintendo began enforcing its copyright ownership and claiming the advertising revenue from video creators who posted screenshots of its games.
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• China has moved one step closer to clean fusion energy by breaking a long-standing rule in plasma physics.

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That step could push density even higher under stronger fusion conditions. Fusion ignition depends on density, temperature, and confinement time working together. In that second path, plasma stays stable even as density keeps rising.

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State censorship of YouTube content

Measurements showed plasma density reaching about 1.3 to 1.65 times the Greenwald limit. But to reach a point where this brew can power itself — a sustainable fusion reaction — requires that gnarly plasma to stay hot, dense, and stable for long stretches of time. “These results are very promising and should be explored in other tokamak devices,” says Jeronimo Olaya, a fusion plasma physicist at the French Alternative Energies and Atomic Energy Commission in Saint-Paul-lez-Durance. To sustain fusion reactions, the plasma must reach an extremely high density — meaning many particles must be packed into a small volume. However, the breach at EAST enabled the researchers to heat the plasma to a previously theorized state called the “density-free regime” for the first time, where the plasma remained stable as the density increased. Department of Energy’s DIII-D National Fusion Facility tokamak in San Diego broke through the limit in 2022, and in 2024, researchers at the University of Wisconsin–Madison in Wisconsin announced that they had maintained a stable tokamak plasma at about 10 times the Greenwald Limit using an experimental device.

After testing earlier in 2021, YouTube removed public display of dislike counts on videos in November 2021, claiming the reason for the removal was, based on its internal research, that users often used the dislike feature as a form of cyberbullying and brigading. It features a simplified user interface, curated selections of channels featuring age-appropriate content, and parental control features. Most of these views came from a relatively small number of videos; according to a software engineer at that time, 30% of videos accounted for 99% of views on the site. Video categories on YouTube include chicken road 2 game music videos, video clips, news, short and feature films, songs, documentaries, movie trailers, teasers, TV spots, live streams, vlogs, and more. By demonstrating a pathway to stable high-density plasma, EAST may have moved one of fusion’s most frustrating limits into the category of solvable design choices.

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It also allowed users to preview videos, share downloaded videos through Bluetooth, and offered more options for mobile data control and video resolution. It was distinct from the company’s main Android app and allowed videos to be downloaded and shared with other users. It offers advertising-free streaming, access to original programming, and background and offline video playback on mobile devices. YouTube also released YouTube Music, a third app oriented towards streaming and discovering the music content hosted on the YouTube platform.

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The video was retracted after it was found that the ads had been triggered by the use of copyrighted content in the video. In early April 2017, the YouTube channel h3h3Productions presented evidence claiming that a Wall Street Journal article had fabricated screenshots showing major brand advertising on an offensive video containing Johnny Rebel music overlaid on a Chief Keef music video, citing that the video itself had not earned any ad revenue for the uploader. The Guardian newspaper, as well as other major British and U.S. brands, similarly suspended their advertising on YouTube in response to their advertising appearing near offensive content. The vast majority of videos on YouTube are free to view and supported by advertising. It also found more “mainstream-adjacent Conservative creators” gaining over alt-right and extremist videos by 2020. According to a 2020 study, viewership of far-right videos on YouTube peaked in 2017 and “a growing body of journalistic evidence” suggested that YouTube was radicalizing young men through its recommendation engine, but that such evidence was “fraught with a bias towards sensationalism”.

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The China artificial sun fusion breakthrough matters because it targets a constraint that shaped decades of tokamak strategy. This does not mean one country “wins fusion.” Fusion is too large for that kind of scoreboard. Official CAS coverage emphasizes the scientific value of exceeding the density limit and the relevance to ignition pathways. Demonstrating stability in a broader range of conditions would strengthen the claim that the approach scales beyond a narrow experimental window. Private fusion efforts often aim for compact, economical systems. ” Stable high-density operation sits near the center of that question.

If a stable regime supports higher density under workable conditions, it can strengthen the case for certain tokamak-based commercial approaches. If plasma-wall self-organization holds across broader conditions, future tokamaks may not need to rely only on increasingly complex active stabilization for every high-density scenario. Many fusion advances come from better control during the “middle” of a plasma pulse.

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Should the uploader want to monetize the video again, they may remove the disputed audio in the “Video Manager”. When a video is uploaded, it is checked against the database, and flags the video as a copyright violation if a match is found. The system, which was initially called “Video Identification” and later became known as Content ID, creates an ID File for copyrighted audio and video material, and stores it in a database. Google CEO Eric Schmidt regarded this system as necessary for resolving lawsuits such as the one from Viacom, which alleged that YouTube profited from content that it did not have the right to distribute.

On YouTube, this will be based on factors such as searches and video history, and the age of the account. In April 2024, YouTube announced it would be “strengthening our enforcement on third-party apps that violate YouTube’s Terms of Service, specifically ad-blocking apps”. In late October 2023, YouTube began cracking down on the use of ad blockers on the platform. In 2020, Roku removed the YouTube TV app from its streaming store after the two companies were unable to reach an agreement. Joining the YouTube Kids app, the company created a supervised mode, designed more for tweens, in 2021. In 2013, YouTube launched a pilot program for content providers to offer premium, subscription-based channels.

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