ACCT 3013-Francine’s Fast Deliveries, Inc. (FFD)-Post the beginning balances
Project 1: Part 2
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 | $ | 1,625 | Accounts Payable | $ | 1,310 | ||
| Accounts Receivable | 1,000 | Stockholders’ Equity: | |||||
| Supplies | 800 | Contributed Capital | $ | 1,500 | |||
| Retained Earnings | 615 | ||||||
| Total Assets | $ | 3,425 | Total Liabilities & Stk. Equity | $ | 3,425 | ||
| January Transactions for Francine’s Fast Deliveries, Inc. (FFD) |
| Date | |
| 1 | Owners invest $28,000 of additional cash in the business. |
| 2a | Supplies are purchased for $1,100 on account. |
| 2b | Insurance is paid for 12 months beginning January 1: $7,860 (Record as an asset) |
| 2c | Rent is paid for 3 months beginning in January: $4,050 (Record as an asset) |
| 2d | Two employees are hired. Each employee will be paid $1,570 per month |
| 3 | FFD borrows $32,000 from 1st State Bank at 6% annual interest. |
| 6 | A delivery van is purchased for cash. Including tax the total cost was $52,800. 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. |
| 7 | $700 of the receivables from December’s sales are collected. |
| 8 | $1,048 of the accounts payable from December are paid. |
| 9 | Performed services for customers on account. Mailed invoices totaling $10,200. |
| 10 | Services are performed for cash customers: $7,140. |
| 16 | Wages for the first half of the month are paid on January 16: $1,570. |
| 20 | The company receives $3,800 from a customer for an advance order for services to be provided in January and February. |
| 25 | Collections from customers on account (see January 9 transaction): $4,080 |
| 30a | The last 2 weeks wages earned by employees are $785 per employee and will be paid on February 3. |
| 30b | A $995 utility bill for January arrived. It is due on February 15. |
| Additional Information for adjusting entries at January 31: |
| a. | Supplies on hand on January 31 total $380. |
| b. | The company completed 60% of the deliveries for the customer who paid in advance on January 20. |
| c. | Interest is accrued for the bank loan. (Assume a full month for the 1st State Bank loan.) |
| d. | Record January depreciation. |
| e. | Adjust the prepaid asset (Rent and Insurance) accounts as needed. |
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Rating:
/5
Solution: ACCT 3013-Francine’s Fast Deliveries, Inc. (FFD)-Post the beginning balances