Additional interest for five months needs to be accrued on the $$32,000,6\%$ note payable obtained on August $1,2024.$ Recall that annual interest is paid each July $31.$

Assume that $$12,000$ of the $$32,000$ note discussed above is due next year. Record the entry to reclassify the current portion of long$-$term note.

By the end of the year, $$20,000$ in gift cards have been redeemed. The company had sold gift cards of $$27,000$ during the year a recorded those as Deferred Revenue.

Great Adventures is a defendant in litigation involving a biking accident during one of its adventure races. The company believes the likelihood of payment occurring is probable, and the estimated amount to be paid is $$14,000.$

For sales of MU watches, Great Adventures offers a warranty against defect for one year. At the end of the year, the company estimates future warranty costs to be $$6,000.$

$\backslash$table$[[,,,,,,$Requirement,$\backslash$table$[[$General$],[$Journal$]],\backslash$table$[[$General$],[$Ledger$]],$Trial Balance,$\backslash$table$[[$Income$],[$Statement$]],$Balance Sheet$]]$

Record each of the transactions listed above in the 'General Journal' tab. Review the 'General Ledger' and the 'Trial Balance' tabs to see the effect of the transactions on the account balances.

Review the 'Trial Balance' as of December $31,2025,$ in the 'Trial Balance' tab.

Prepare a multiple$-$step income statement for the period ended December $31,2025,$ in the 'Income Statement' tab.

Prepare a classified balance sheet as of December $31,2025,$ in the 'Balance Sheet' tab.

Record the closing entries in the 'General Journal' tab.