C9-1 Accounting for Operating Activities (Including Depreciation) and Preparing Financial Statements (Chapters 3, 4, 8, and 9) [LO 3-3, LO 4-2, LO 8-2, LO 9-2, LO 9-3] Grid Iron Prep Inc. (GIPI) is a service business incorporated in January 2013 to provide personal training for athletes aspiring to play college football. The following transactions occurred during the year ended December 31, 2013. a. GIPI issued stock in exchange for $100,000 cash. b. GIPI purchased a gymnasium building and gym equipment at the beginning of the year for $50,000, 80% of which related to the gymnasium and 20% to the equipment. c. GIPI paid $260 cash to have the gym equipment refurbished before it could be used. d. GIPI collected $36,000 cash in training fees during the year, of which $2,000 were customer deposits to be earned in 2014. e. GIPI paid $23,000 of wages and $7,000 in utilities. f. GIPI provided $4,000 in training during the final month of the year and expected collection in 2014. g. GIPI will depreciate the gymnasium building using the straight-line method over 20 years with a residual value of $2,000. Gym equipment will be depreciated using the double-declining method, with an estimated residual value of $2,250 at the end of its four-year useful life. h. GIPI received a bill for $350 of advertising done during December. The bill has not been paid or recorded. i. GIPI will record an estimated 3 percent of its Accounts Receivable as not collectible. j. GIPIs income tax rate is 30%. Assume depreciation for tax is the same amount as depreciation for financial reporting purposes.

Required:

1.

Prepare journal entries to record the transactions and adjustments listed in (a)(j). (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.)

2.	Prepare GIPIs annual income statement, statement of retained earnings, and classified balance sheet.