Fast Deliveries, Inc. (FDI), was organized in December last year and had limited activity last year....
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Fast Deliveries, Inc. (FDI), was organized in December last year and had limited activity last year. The resulting bala sheet at the beginning of the current year is provided below: Assets: Cash Accounts Receivable Supplies Total Assets Ch. 2 NNNNNN January 2 3 $10,900 740 770 $12,410 4 5 FAST DELIVERIES, INC. Balance Sheet at January 1 Liabilities: Accounts Payable Stockholders Equity: Common Stock Retained Earnings Total Liabilities and Stockholders Equity Two employees have been hired, at a monthly salary of $2,900 each. The following transactions occurred during Jana of the current year. $ $4,500 is paid for 12 months Insurance starting January 1. (Record as an asset.) $3,600 is paid for 12 months of rent beginning January 1. (Record as an asset.) FDI borrows $28,800 cash from First State Bank at 4% annual Interest; this note is payable in two years. A delivery van is purchased using cash. Including tax, the total cost was $19,200. Stockholders contribute $5,000 of additional cash to FDI for its common stock. 6 Additional supplies costing $1,100 are purchased on account and received. Performed services for customers on account. Sent invoices toteling $10,500. $7,800 of services are performed for customers who paid immediately in cash. 500 11,410 500 $12,410 $600 of accounts receivable arising from last year s December sales are collected. H 3500 of accounts payable from December of last year are paid. 9 AA 333 3 Ch. 4 4 4 4 4 4 10 $7,800 of services are performed for customers who paid immediately in cash. 16 $2,900 of salaries are paid for the first half of the month. 20 FDI receives $3,900 cash from a customer for an advance order for services to be provided later in January and in February. $3,600 is collected from customers on account (see January 9 transaction). 25 January 31a. 31b. 31c. 31d. 31e. 31f. 31g. Additional information for adjusting entriest A $1,200 bill arrives for January utility services. Payment is due February 15. Supplies on hand on January 31 are counted and determined to have cost $210. As of January 31, FOI had completed 60% of the deliveries for the customer who paid in advance on January 20, Accrue one month of interest on the bank loan. Yearly Interest is determined by multiplying the amount borrowed by the annual Interest rate (expressed as 0.04). For convenience, calculate January interest as one-twelfth of the annual interest. Assume the van will be used for 4 years, after which it will have no value. Thus, each year, one-fourth the van s benefits will be used up, which implies annual depreciation equal to one-fourth of the van s total cost. Record depreciation for the month of January, equal to one-twelfth of the annual depreciation expense. Salaries earned by employees for the period from January 16-31 are $1,450 per employee and will be paid on February 3. Adjust the prepaid asset accounts (for rent and insurance) as needed. of 5 ook int ences 2-a. Set up T-accounts for the accounts on the trial balance. Enter beginning balances and post the transactions January 1-25, adjusting entries of January 31. 2-b. Prepare an unadjusted trial balance at January 31. Complete this question by entering your answers in the tabs below. Reg 2A Req 2B Set up T-accounts for the accounts on the trial balance. Enter beginning balances and post the transactions January 1-25, adjusting entries of January 31. Beg Bal 10,900 Beg. Bal Accounts Receivable Beg. Bal End Bal Beg. Bal. End. Bal Bog Bal End Bal Prepaid Rent Accumulated Depreciation Beg. Bal. End. Bal Beg. Bal End. Bal Beg Bat End. Bal Equipment Accounts Payable Beg Bal End. Bal Beg. Bal End Bal Beg. Bal End-Bal Deferred Revenue Interest Payable Common Stock Beg. Bal End. Bal Beg Bal End. Bal. Beg Bal End: Bal Notes Payable (long-term) 0 Salaries and Wages Payable Retained Earnings Beg. Bal End. Bal. Beg Bal End Bal. Beg Bal Service Revenue Utilities Expense Interest Expense Beg Bal End. Bal. Beg Bal End. Bat. Beg Bat Salaries and Wago- Expense Supplies Expenses Insurance Expenses Beg. Bal End. Bal. Rent Expense Beg Bal End. Bal Depreciation Expense Fast Deliveries, Inc. (FDI), was organized in December last year and had limited activity last year. The resulting bala sheet at the beginning of the current year is provided below: Assets: Cash Accounts Receivable Supplies Total Assets Ch. 2 NNNNNN January 2 3 $10,900 740 770 $12,410 4 5 FAST DELIVERIES, INC. Balance Sheet at January 1 Liabilities: Accounts Payable Stockholders Equity: Common Stock Retained Earnings Total Liabilities and Stockholders Equity Two employees have been hired, at a monthly salary of $2,900 each. The following transactions occurred during Jana of the current year. $ $4,500 is paid for 12 months Insurance starting January 1. (Record as an asset.) $3,600 is paid for 12 months of rent beginning January 1. (Record as an asset.) FDI borrows $28,800 cash from First State Bank at 4% annual Interest; this note is payable in two years. A delivery van is purchased using cash. Including tax, the total cost was $19,200. Stockholders contribute $5,000 of additional cash to FDI for its common stock. 6 Additional supplies costing $1,100 are purchased on account and received. Performed services for customers on account. Sent invoices toteling $10,500. $7,800 of services are performed for customers who paid immediately in cash. 500 11,410 500 $12,410 $600 of accounts receivable arising from last year s December sales are collected. H 3500 of accounts payable from December of last year are paid. 9 AA 333 3 Ch. 4 4 4 4 4 4 10 $7,800 of services are performed for customers who paid immediately in cash. 16 $2,900 of salaries are paid for the first half of the month. 20 FDI receives $3,900 cash from a customer for an advance order for services to be provided later in January and in February. $3,600 is collected from customers on account (see January 9 transaction). 25 January 31a. 31b. 31c. 31d. 31e. 31f. 31g. Additional information for adjusting entriest A $1,200 bill arrives for January utility services. Payment is due February 15. Supplies on hand on January 31 are counted and determined to have cost $210. As of January 31, FOI had completed 60% of the deliveries for the customer who paid in advance on January 20, Accrue one month of interest on the bank loan. Yearly Interest is determined by multiplying the amount borrowed by the annual Interest rate (expressed as 0.04). For convenience, calculate January interest as one-twelfth of the annual interest. Assume the van will be used for 4 years, after which it will have no value. Thus, each year, one-fourth the van s benefits will be used up, which implies annual depreciation equal to one-fourth of the van s total cost. Record depreciation for the month of January, equal to one-twelfth of the annual depreciation expense. Salaries earned by employees for the period from January 16-31 are $1,450 per employee and will be paid on February 3. Adjust the prepaid asset accounts (for rent and insurance) as needed. of 5 ook int ences 2-a. Set up T-accounts for the accounts on the trial balance. Enter beginning balances and post the transactions January 1-25, adjusting entries of January 31. 2-b. Prepare an unadjusted trial balance at January 31. Complete this question by entering your answers in the tabs below. Reg 2A Req 2B Set up T-accounts for the accounts on the trial balance. Enter beginning balances and post the transactions January 1-25, adjusting entries of January 31. Beg Bal 10,900 Beg. Bal Accounts Receivable Beg. Bal End Bal Beg. Bal. End. Bal Bog Bal End Bal Prepaid Rent Accumulated Depreciation Beg. Bal. End. Bal Beg. Bal End. Bal Beg Bat End. Bal Equipment Accounts Payable Beg Bal End. Bal Beg. Bal End Bal Beg. Bal End-Bal Deferred Revenue Interest Payable Common Stock Beg. Bal End. Bal Beg Bal End. Bal. Beg Bal End: Bal Notes Payable (long-term) 0 Salaries and Wages Payable Retained Earnings Beg. Bal End. Bal. Beg Bal End Bal. Beg Bal Service Revenue Utilities Expense Interest Expense Beg Bal End. Bal. Beg Bal End. Bat. Beg Bat Salaries and Wago- Expense Supplies Expenses Insurance Expenses Beg. Bal End. Bal. Rent Expense Beg Bal End. Bal Depreciation Expense
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Fundamentals of Financial Accounting
ISBN: 978-1259864230
6th edition
Authors: Fred Phillips, Robert Libby, Patricia Libby
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