Francine\'s Fast Deliveries, Inc. (FFD) was organized in December of 2011. It ha

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Francine's Fast Deliveries, Inc. (FFD) was organized in December of 2011. It had limited activity in 2011. The resulting balance sheet at the beginning of 2012 is provided beloww Francine's Fast Deliveries, Inc Balance Sheet at January 1, 2012 B5O Accounts Payable ots Recelbe 950 Conibuned Capital Retained Eamings oral Assers January Transactions for Francine's Fast Deliveries, Inc. (FFD) Owners invest $31000 of additional cash in the business Supplies are purchased for $1,250 on account Insurance is paid for 12 months beginning January 1: $8,400 (Record as an asset) Rent is paid for 3 months beginning in January: $4,650 (Record as an asset) 2 Two employees are hired. Each employee will be paid $1,780 per month FFD borrows $35,000 from 1st State Bank at 6% annual 6 A delivery van is purchased for cash. Including tax the total cost was $60,000. It will be used for 4 years and will be depreciated monthly using straight-line with no salvage value. A full month of depreciation will be charged in January. $805 of the receivables from December's sales are collected. $1,008 of the accounts payable from December are paid. 9 Performed services for customers on account. Mailed invoices totaling $11,000. Services are performed for cash customers: $7,700. Wages for the first half of the month are paid on January 16: $1,780 The company receives $4,250 from a customer for an advance order for services to be provided in January and Collections from customers on account (see January 9 transaction): $4,400 The last 2 weeks wages earned by employees are $890 per employee and will be paid on February 3 A $1130 utility bill for January arrived. It is due on February 15 3 Additional Information for adjusting entries at January 31: Supplies on hand on January 31 total $440. b The company completed 60% of the deliveries for the customer who paid in advance on January 20. Interest is accrued for the bank loan. (Assume a full month for the 1st State Bank loan.) d Record January depreciation. Adjust the prepaid asset (Rent and Insurance) accounts as

Explanation / Answer

T-accounts are as prepared below:

Cash Contributed Capital Particulars Amount Particulars Amount Particulars Amount Particulars Amount Beg Balance 1,850 Jan 2b 8,400 Beg Balance 2,000 Jan-01 31,000 Jan 2c 4,650 Jan-01 31,000 Jan-03 35,000 Jan-06 60,000 33,000 Jan-07 800 Jan-08 1,008 Ending balance 33,000 Jan-10 7,700 Jan-16 1,780 Accounts payable Jan-20 4,250 Particulars Amount Particulars Amount Jan-25 4,400 Jan-08 1,008 Beg Balance 1,260 85,000 75,838 Jan 2a 1,250 Ending balance 9,162 Account Receivable Particulars Amount Particulars Amount 1,008 2,510 Beg Balance 1,150 Jan-07 800 Ending balance 1,502 Jan-09 11,000 Jan-25 4,400 Retained Earnings Particulars Amount Particulars Amount Beg Balance 690 12,150 5,200 0 690 Ending balance 6,950 Ending balance 690 Supplies Particulars Amount Particulars Amount Note Payable Beg Balance 950 Jan-31 1,760 Jan-03 35,000 Jan 2a 1,250 2,200 1,760 0 35,000 Ending balance 440 Ending balance 35,000 Prepaid Insurance Unearned Service Revenue Particulars Amount Particulars Amount Particulars Amount Particulars Amount Beg Balance 0 Jan-31 700 Jan-31 2,550 Beg Balance 0 Jan 2b 8,400 Jan-20 4,250 8,400 700 2,550 4,250 Ending balance 7,700 Ending balance 1,700 Interest payable Prepaid Rent Particulars Amount Particulars Amount Particulars Amount Particulars Amount Jan-31 175 Beg Balance 0 Jan-31 1,550 Jan 2c 4,650 0 175 4,650 1,550 Ending balance 175 Ending balance 3,100 Interest Expense Delivery Van Particulars Amount Particulars Amount Particulars Amount Particulars Amount Jan-31 175 Beg Balance 0 Jan-06 60,000 175 0 Ending balance 175 60,000 0 Accumulated dep Ending balance 60,000 Particulars Amount Particulars Amount Jan-31 417 Service Revenue Particulars Amount Particulars Amount 0 417 Jan-09 11,000 Ending balance 417 Jan-10 7,700 Jan-31 2,550 Depreciation Particulars Amount Particulars Amount 0 21,250 Jan-31 417 Ending balance 21,250 417 0 Wages Expense Ending balance 417 Particulars Amount Particulars Amount Jan-16 1,780 Rent Expense Jan 30a 1,780 Particulars Amount Particulars Amount Jan-31 1,550 3,560 0 1,550 0 Ending balance 3,560 Ending balance 1,550 Wages payable Insurance Expense Particulars Amount Particulars Amount Particulars Amount Particulars Amount Jan 30a 1,780 Jan-31 700 700 0 Ending balance 700 0 1,780 Ending balance 1,780 Utility Expense payable Particulars Amount Particulars Amount jan 30b 1,130 0 1,130 Ending balance 1,130 Utility Expense Particulars Amount Particulars Amount Jan 30b 1,130 1,130 0 Ending balance 1,130 Supplies Expense Particulars Amount Particulars Amount Jan-31 1,760 1,760 0 Ending balance 1,760

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