Case Study Rhys Fries Part 3 June 1, 20X1 After the success of his first convention Ronald starts to wonder if he can make this business become his career. He is confident in his abilities but isnt really sure where to go next. A patron from the LadLard event mentioned to him during the show that there is a bigger and more prestigious event coming up at the end of the month; the Oilmaggedon. This 5 day outdoor event (June 20-24) brings together hundreds of vendors and many thousands of hungry patrons. On top of that there are often cooking celebrities and famous food critics wandering around. Ronald is convinced this is the exposure he needs to give his business a boost. However, the event only has a limited amount of spots and its only for those with food trucks. A bigger event also means higher entrance fees. The cost to get a spot at Oilmaggedon is $3,500. There are no options to rent a deep fryer and no amenities are provided. Ronald decides its worth the risk. He quits his job to dedicate his full attention to Rhys Fries. June 10, 20X1 His first task is to find a suitable food truck. Luckily, he noticed at the end of the LadLard convention that a fellow vendor had a FOR SALE sign on his food truck. The vendor was asking $15,000 for the truck but Ronald was able to negotiate him down to $13,200. Its a used truck, but Ronald estimates it has a remaining useful life of 4 years. To purchase the truck he put down $1,000 cash and took out a secured loan from the bank for the remainder. The loan is due in full in four months carries a 6% interest rate. The loan is a fixed interest loan (interest and principal due at maturity). After picking up the food truck he pays the $3,500 entry fee. Ronald also purchases and pays the required insurance for the truck that cost $1,800 for the year. June 18, 20X1 Two days before the event starts Ronald takes out a short term business operating loan from a local lending firm for $6000. The loan is due in full by June 30, 20X1 and has a $400 interest charge due upon payment. Then he heads over to the local mega-mart to buy 100 bags of potatoes at $37 per bag, 20 pails of oil at $30 per pail and $400 worth of amenities (plates, napkins, and utensils). 3.) Complete any required journal entries for these events. Hint: Consider the amenities and oil to be supplies and not inventory.