Question

Required information [The following information applies to the questions displayed below.) 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 below. Francine's Fast Deliveries, Inc. Balance Sheet at January 1, 2012 Assets: Liabilities: Cash $ 875 Accounts Payable Accounts Receivable 450 Stockholders' Equity: Supplies 250 Contributed Capital Retained Earnings $ 250 $1,000 325 Total Assets $1,575 Total Liabilities & Stk. Equity $1,575 January Transactions for Francine's Fast Deliveries, Inc. (FFD) Date 1 Owners invest $18,000 of additional cash in the business. 2a Supplies are purchased for $550 on account. 2b Insurance is paid for 12 months beginning January 1: $6,060 (Record as an astet) 2c Rent is paid for 3 months beginning in January: $2,550 (Record as an asset) 2d Two employees are hired. Each employee will be paid $870 per month 3 FFD borrows $21,000 from 1st State Bank at 6% annual interest. LLLLLLLL W A ... - .. ---

Answer 1

Please find below Adjusted TB with necessary calculations:

Please note that

- "Grey shaded" columns are only for understanding the calculations; thus input only numbers as per Adjusted TB column in your answer sheet.

- in "reference" column, transaction dates are mentioned for easy understanding. If date is mentioned without bracket, that account is debited and with bracket denotes credit in that account. For example, Jan 1 dated entry Dr in cash account for $ 18000 and Cr in Capital account for $ 18000.

- "Accumulated Depreciation" balance can be shown either on Credit side or "with negative sign" on debit side. Either ways Trial Balance(TB) will reconcile. Only difference will be in totals. (i.e.) below presented table shows total as $ 58,700 in both debit & credit. If you show the accumulated depreciation with "negative sign" on debit side, then totals become $ 58,100 on both debit and credit.

Adjustment & Closing Entries Adjusted TB as of Jan 31 Opening Balance Reference ("without brackets" mean "Debit"; "with brackets" mean "Credit") 38,480 1,(2b),(2c), 3, ( 6), 7, (8), 10, (16), 20, 25 3,595 (7),9,(25) 640 2a,(a) 850 2c, (e-2550/3) 505 2b,(e-6060/12) 6, Account title Debit Credit Debit Credit Debit Credit Cash 12,880 875 50,485 Accounts Receivable 450 8,200 5,055 Supplies Prepaid Rent 250 550 160 2,550 1,700 Prepaid Insurance 6,060 5,555 Equipment 28,800 28,800 |(d) either this can be shown on Credit side or "with negative sign" on debit side; eitherways TB will 600 reconcile; only totals will change 1,095 (2a),8,(30b) 2,150 (20), b-2150* 60% 435 (30a), 105 (c-21000*6%/12) 21,000 (3), 18,000 (1), Accumulated Depreciation - Equipment 600 Accounts Payable 250 200 1,145 Unearned Revenue 1,290 860 Wages Payable Interest Payable 435 105 Notes Payable-Bank Loan 21,000 Contributed Capital 1,000 19,000 Retained Earnings 325 325 15,230 (9),(10),(b-2150*60%) 16,30a 30b 15,230 Service Revenue Wages Expense 1,305 1,305 Utilities Expense 545 545 Supplies Expense 640 640 a d-28800/(4*12) e-6060/12 e 2550/3 c=21000*6%/12 Depreciation Expense 600 600 Insurance Expense Rent Expense 505 505 850 850 Interest Expense 105 105 1,575 102,685 58,700 1,575 102,685 58,700