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, 2012Assets:Liabilities:Cash$1,025Accounts Payable$525Accounts Receivable550Stockholders' Equity:Supplies350Common Stock$1,000Retained Earnings400Total Assets$1,925Total Liabilities & Stk. Equity$1,925

January Transactions for Francine's Fast Deliveries, Inc. (FFD)

Date1Owners invest $20,000 of additional cash in the business.2aSupplies are purchased for $650 on account.2bInsurance is paid for 12 months beginning January 1: $6,420 (Record as an asset)2cRent is paid for 3 months beginning in January: $2,850 (Record as an asset)2dTwo employees are hired. Each employee will be paid $1,010 per month3FFD borrows $23,000 from 1^stState Bank at 6% annual interest.6A delivery van is purchased for cash.Including tax the total cost was $33,600. 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$385 of the receivables from December's sales are collected.8$420 of the accounts payable from December are paid.9Performed services for customers on account.Mailed invoices totaling $8,600.10Services are performed for cash customers: $6,020.16Wages for the first half of the month are paid on January 16: $1,010.20The company receives $2,450 from a customer for an advance order for services to be provided in January and February.

25Collections from customers on account (see January 9 transaction): $3,44030aThe last 2 weeks wages earned by employees are $505 per employee and will be paid on February 3.

30bA $635 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 $200.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 1^stState Bank loan.)d.Record January depreciation.e.Adjust the prepaid asset (Rent and Insurance) accounts as needed.

6.Prepare the adjusted trial balance, using the revised set of t-account balances.