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 $12,600 600 720 FAST DELIVERIES, INC. Balance Sheet at January 1 Liabilities: Accounts Payable Stockholders' Equity: Common Stock Retained Earnings Total Liabilities and Stockholders' Equity $ 789 Total Assets $13,920 11,909 1,320 $13,92e Two employees have been hired at a monthly salary of $2.960 each. The following transactions occurred during January of the current year Ch. January 02 3 $6,000 is paid for 12 months insurance starting January 1. (Record as an asset.) $4,800 is paid for 12 months of ment beginning January 1. Record as an asset.) FDI borrow 530,00 cash from State Bank at 5% annual interest: this note is payable 2 Ch. NNN January 1 2 3 4 NNNNN mmmm 5 6 7 8 9 10 16 20 $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 $10,680. $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. $3,500 is collected from customers on account (see January 9 transaction). 3 3 25 Ch. 4 4 January 31a. 31b. 310. 4 4 31d. Additional information for adjusting entries: A $1,100 bill arrives for January utility services. Payment is due February 15. Supplies on hand on January 31 are counted and determined to have cost $280. As of January 31, FDI had completed 60% of the deliveries for the customer who paid in advance on January 20. 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. 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. Salaries earned by employees for the period from January 16-31 are $1,489 per employee and will be paid on February 4 31e. 31f. C4-6 Part 3 3. Record all adjusting journal entries needed at January 31. (Do not round intermediate calculations. If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.) View transaction list Journal entry worksheet 1 2 3 4 5 6 7 8 > Record the adjusting entry for receipt of a $1,100 bill for January utility services. Payment is due February 15. Far dabits before credito