Required information C4-6 Recording/Posting Transactions and Adjustments, and Preparing Trial Balances and Financial Statements-Requires Calculating Depreciation and Interest (Chapters 2, 3, and 4) (LO 2-3, LO 3-3, LO 4- 2, LO 4.4) Fast Deliveries, Inc. (FDI), was organized in December last year and had limited activity last year. The resulting balance sheet at the beginning of the current year is provided below: Assets: Cash Accounts Receivable Supplies FAST DELIVERIES, INC. Balance Sheet at January 1 Liabilities: Accounts Payable Stockholders' Equity! Common Stock Retained Earnings Total Liabilities and Stockholders' Equity $12,600 600 720 $ 700 Total Assets $13,920 11,900 1,320 $13,920 Two employees have been hired, at a monthly salary of $2.960 each. The following transactions occurred during January of the current year. Two employees have been hired, at a monthly salary of $2,960 each. The following transactions occurred during Jan of the current year Ch. NNN January 1 2 3 www WNNNNN 4 5 6 7 8 9 10 16 2e $6,000 is paid for 12 months' insurance starting January 1. (Record as an asset.) $4,800 is paid for 12 months of rent beginning January 1. (Record as an asset.) FDI borrows $30,000 cash from First State Bank at 5% annual interest; this note is payable in two years. A delivery van is purchased using cash. Including tax, the total cost was $28,800. Stockholders contribute $4,000 of additional cash to FDI for its common stock. Additional supplies costing $1,400 are purchased on account and received. $700 of accounts receivable arising from last year's December sales are collected. $300 of accounts payable from December of last year are paid. Performed services for customers on account. Sent invoices totaling $10,600. $7,400 of services are performed for customers who paid immediately in cash. $2,960 of salaries are paid for the first half of the month. FDI receives $3,700 cash from a customer for an advance order for services to be provided later in January and in February. LO O buvau HUA HELEAVE> PULO GLULE SEE VALE LUC PAUCU later in January and in February. $3,500 is collected from customers on account (see January 9 transaction). 3 25 Ch. 4 4 4 4 January Additional information for adjusting entries: 31a. A $1,100 bill arrives for January utility services. Payment is due February 15. 31b. Supplies on hand on January 31 are counted and determined to have cost $280. 310. As of January 31, FDI had completed 60% of the deliveries for the customer who paid in advance on January 20. 31d. 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 0.05). For convenience, calculate January interest as one-twelfth of the annual interest. 31e. Assume the van will be used for 4 years, after which it will have no value. Thus, each year, one-fourth of 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. 31f. Salaries earned by employees for the period from January 16-31 are $1,480 per employee and will be paid on February 3. 318 Adjust the prepaid asset accounts for rent and insurance) as needed. 4 4 C4-6 Part 4 5 4-a. Post the adjusting journal entries from part 3, set up T-accounts for the accounts on the trial balance. 4-b. Post the adjusting entries from part 3 and prepare an adjusted trial balance. Complete this question by entering your answers in the tabs below. ok Req 4A Req 4B nces Post the adjusting entries from part 3 and prepare an adjusted trial balance. (Do not round intermediate calculations.) FAST DELIVERIES, INC. Adjusted Trial Balance Debit Credit Account Titles Cash Accounts Receivable Cash Accounts Receivable Beg Bal. Beg. Bal. EndBal End. Bal. Supplies Prepaid Insurance Beg Bal. Beg. Bal. End. Bal End. Bal. Prepaid Rent Equipment Required information Prepaid Rent Equipment Beg Bal Beg. Bal. End Bal End. Bal. Accumulated Depreciation Accounts Payable Beg Bal Beg Bal End Bal End. Bal Deferred Revenue Notes Payable (long term Beg Bal Beg Bal End. Bal. End. Bal 0 Interest Payable Salaries and Wages Payable Beg. Bal. Beg. Bal. End. Bal End. Bal Common Stock Retained Earnings Beg. Bal Beg. Bal. End. Bal End. Bal. Service Revenue Salaries and Wages Expense Required information Service Revenue Salaries and Wages Expense Beg Bal Beg. Bal. End. Bal End. Bal. Utilities Expense Supplies Expenses Beg Bal Beg Bal End. Bal End. Bal Interest Expense Insurance Expenses Beg Bal. Beg Bal LU in-1 Required information TET Beg. Bal. Beg. Bal. End. Bal End Bal. Rent Expense Depreciation Expense Beg Bal Beg. Bal. End. Bal. End. Bal Post the adjusting entries from part 3 and prepare an adjusted trial bal FAST DELIVERIES, INC. Adjusted Trial Balance Debit Credit Account Titles Cash Accounts Receivable Supplies Prepaid Rent Prepaid Insurance Equipment Accumulated Depreciation Accounts Payable Deferred Revenue Salaries and Wages Payable Interest Payable Required information Interest Payable Notes Payable (long-term) Common Stock Retained Earnings Service Revenue Salaries and Wages Expense Utilities Expense Supplies Expenses Depreciation Expense Insurance Expense Rent Expense Interest Expense Totals $ 0 $ GA 0