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60 1 Required information The following information applies to the questions displayed below Part 3 of B Tony and Suzie graduate from college in May 2021 and begin developing their new business. They begin by offering clinics for basic outdoor activities such as mountain biking or kayaking Upon developing a customer base, theyl hold their first adventure races. These races wi involve four-person teams that race from one checkpoint to the next usng 6.25 combination of kayaking, mountain biking,orienteering, and trail running. In the long run, they plan to sell outdoor gear and develop a ropes course for outdoor enthuslasts On July 1,2021 Tony and Suzie organize their new company as a corporation, Great Adventures Inc. The articles of incorporation state that the corporation will sell 38,000 shares of common stock for $1 each. Each share of stock represents a unit of ownership. Tony and Suzie will act as co-presidents of the company The following transections accur from July 1 through December 31 Print Jul. 1 Sell $19,000 of comnon stock to Susie Jul. sa11 519,000 of connon stock to Tony Jul. Purchase a one-year insurance poliey f r 4,080 (340 per month) to oover injuries to partieipasts during outdoor elinies Jul. 2 Pay legal fees of $1,700 associated with incorporstion Jul. 4 Purchase office supplies of $1.600 on aceount Jul. Pay tor advertiaing of 210 to a local vapaper for an upooning nountain biking elinio to be held on Tuly 15. Atcendees vill be charged $30 on the day of the clisie. ul.Purchase 10 mountain bikes, paying $13,100 eash Jul. 15 on the day of the clinie, Great Adventures receives cass ot $2,400 from 0 bikers. Toey condueta the sountain biking linic and the oonpany receives 2,800 heid on hogust 10, and attendess cas pay $100 in sevace or 1150 on the day of the ellale recestly passed an instiative enoouraging businsss daveloprest related to outdoor aotivicies. h Jul. 22 necsuse of the success of the fires mountain biking elisie, tony holds another mountala biking eline Jul. 24 Pay S61to a local radio station for advertiting to nppear imediately. A kayaking clinie will be Jul. 30 Great Adventures receives eash of s4,o00 in aevance from 40 kayakees for the upooning kayak elinie Aus. 1 Great Adventures obtains $43.000 Tov-isterest loan for the copany from the eity cousel, whih losn is doe in three yearsand 6 annual interest ia doe each year on uly J Check m 6 loan is due in three years, and 6% annual interest is due each year on July 31 Aug. 4 The company purchasen 14 kayaks, paying $18,000 cash. Aug. 10 Tventy additional kayakers pay $3,000 ($150 each), in addition to the $4,000 that was paid in advance n July 30, on the day of the clinic. Tony conducts the first kayak clinic Aug. 17 Tony conducts a second kayak clinic, and the company receives $11,300 cash. Aug. 24 Office supplies of $1,600 purchased on July 4 are paid in full Sep. 1 To provide better storage of mountain bikes and kayaks when not in use, the company rents a storage Part 3 of 8 shed for one year, paying $3,360 ($280 per month) in advance Sep. 21 Tony conduets a rock-climbing elinic. The conpany receives $14,600 cash oct 17 Tony conducts an orienteering clinic. Partiespants praetice how to underetand a topographical map, 6.25 points read an altimeter, use a compass, and orient through heavily wooded areas. The company receives 19,500 cash. Dec. 1 Tony decides to hold the company's first adventure race on December 15. Four-person teams vill race Skipped from checkpoint to checkpoint using a conbination of mountain biking, kayaking, orienteering, trail running, and rock-clinbing skills. The tirst team in each category to complete all checkpoints in order wins. The entry fee for each tean is $700 Dec. 5 To help organize and promote the race, Tony hires his college roommate, Victor. Victor will be paid Dee. 8 The eompany pays $1,200 to purehase a permit from a atate park where the race wi1l be held. The Dec. 12 The company purchases racing supplies for $2,100 on account due in 30 days. Supplies include trophies eBook 60 in salary for each tean that competes in the race. His salary will be paid after the race amount is recorded a.B a miscellaneous expense References for the top-finiahing teams in each category, promotional shirts, snack foods and drinks for participants, and field markers to prepafe the racecourse Dec. 15 The company receives $28,000 cash from a total of forty teams,and the race is held. Dec. 16 The company pays Victor's salary of $2,400 Dec. 31 The company pays a dividend of $4,100 (2.050 to Tony and $2,050 to Suzie). Dec. 31 using his personal money, tony purchases a diamond ring for S4, , Tony surprises susie by proposing that they get married. Suzie accepts and they get married The following information relates to year-end adjusting entries as of December 31, 2021. a. Depreciation of the mountain bikes purchased on July 8 and kayaks purchased on August 4 totals $7,00o. b. Six months' of the one-year insurance policy purchased on July 1 has expired. c. Four months of the one-year rental agreement purchased on September 1 has expired. d. Of the $1,600 of office supplies purchased on July 4, $400 remains e. Interest expense on the $43,000 loan obtained from the city council on August 1 should be recorded. t Of the $2,100 of racing supplies purchased on December 12, $250 remains. Prev6 678 1110,16 Next > 6 3. Post transactions from August 1 through December 31 and adjusting entries on December 31 to T-accounts. Part 3 of EB Cash Prepaid Insurance Beg. Bal 27,500 Beg. Bal 4,080 6.25 points End. Bal 4,080 Skipped Print End. Bal 27,500 Referencers Prepaid Rent Supplies (Office) Beg. Bal. Beg. Bal. 1,600 End. Bal. End. Bal 1,600 Supplies (Racing) Equipment (Bikes Beg. Bal Beg. Bal. 13,100 Part 3 of 8 Beg. Bal Beg. Ba 13,100 6.25 points End. Bal End. Bal 3,100 Skipped Beg Ba Beg. Ba Print End. Bal End. Bal eg. Ba 1,600 Beg Ba 4,000 End. Bal ,600 End Bal ,000 Beg. Bal Beg Bal End Ral Required information Interest Payable Income Tax Payable rt 3 of 8 Beg. Bal. Beg. Bal End. Bal. End. Ba Skipped Notes Payable Common Stock Beg. Bal Beg. Bal 38,000 eBook Print References End. Bal End. Bal 38,000 Service Revenue (Clinic) Beg. Bal. Beg. Bal 5,200 End. Bal. End. Bal 5,200 Service Revenue (Racing) Advertising Expense Beg. Bal Beg. Bal Drau Required information Service Revenue (Racing) Advertising Expense 3 of 8 Beg. Bal Beg. Bal End. Bal. End. Bal ipped Legal Fees Expense Miscellaneous Expense Beg. Bal Beg. Bal. Book rint End. Bal End. Bal. Salaries Expense Depreciation Expense Beg. Bal. Beg. Bal End. Bal End. Bal. Insurance Expense Rent Expense Beg. Bal. Beg. Bal End Ral End Ral Part 3 of 8 Beg Bal Beg. Bal 6.25 points End. Bal End. Bal. Beg Bal Beg Bal End. Bal End. Bal. Beg. Bal Beg. Bal End. Bal End. Bal

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