Complete requirements 1-7
Tony and Suzie graduate from college in May 2024 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, they'll hold their first adventure races These races will involve four-person teams that race from one checkpoint to the next using a combination of kayaking, mountain biking, orlenteering. and trail running In the long run, they plan to sell outdoor gear and develop a ropes course for outdoor enthusiasts. On July 1, 2024, Tony and Suzie organize their new company as a corporation, Great Adventures incorporated The articles of incorporation state that the corporation will sell 30,000 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 business activities occur during July for Great Adventures July 1 July 1 ouly : 1 July 2 July 4 July 7 july II July is July 22 July 24 2uly 30 the following August 1 August 4 Aogust 10 August is? August 24 septemenen Se11 \$15,00s of comman stock to Suzie. sell $15,000 of common stock to Toey. Purchase a one-year insurance policy for \$3, e40 (\$3za per month) to cover injurles to participants daring outdooe cilnics. Pay legal fees of 31,100 associated with incorporation. Purchase office suppites of 11,600 on account. Pay $360 to a local newspaper for advertising to appear imediately fok an upcoming mountain biking Clinie to be held on July. 15 . Attendees wil be charged 140 on the day of the cilinic. Purchase 10 moustaln bikes, paying $10,900 cash. on the day of the clinic, fireat adventures receives cash of $2,400 in katal from 66 bikers, Tony and suzie conducts the poustain biking ctinic. Bechase of the success of the first mountaln biking elinic, Yony and suzie kolds another mountals blking cilnic and the coepany receives $2,750. g transactions ocsur over the reosinder of 2024. an intiative encouraging business developsent related to gutdoor nctivities. The loan is due in three years, asd ox annual interest is due each year on July 31. The conpaey purchases 14 kayals, poyine 324,000 cash. fony and suzie conducts secind kayak clinic, and the conpany recelven $13,200 cash. office supplies of 51 , 60 purchased on 3 wiy a are paid in full. peying 24,680 (\$390 per sonth) in sdvance. september 21 Tany and suzie conduce a rock-climbing silnie. The company receives s13, seo cash. ten19$510. Desputine 3 climbing skills. The 1 irst teas In each category ta cooplete all checkpoints in order ins. The entry fee for each tean is $610. Decesber s To help orgonize and proeote the race, Tony hires his college roonmate, Victor. Victor will be pald $50 in solary for each tean that competes in the race. His salary whil be poid after the race. Decenber 8. The corpany pays $1,300 to porchase o pernit froe a state park here the race will be held. The anount is recorded as a miscellaneous expense. Decenber 12 The company purchases racing supplies for $2,300 on account due in 30 days. Supplies inclode trophies for the top. finlshing teass in each category, promotional shirts, snack fodds and drinks for participants, ard fleld narkers to prepore the rocecourse. Decenber 15 The coepany recelves $24,400 cash fron a total of forty teans, and the race is held. Decenber 16 The company pays victor's salary of $2,000. December 31 The conpany pays a dividend of $4,500($2,250 to tony and $2,250 to suzie ). Decenber 31 Using his persanal mopey. Tony purchases a dianond ring for $4,500. Tony surpeises Surie by proposing that they get married, Surle accepts ond they get married! The following information relates to year-end adjusting entries as or December 31,202.4 a. Depreciation of the mountain bikes purchased on July 8 and kayaks purchased on August 4 totals $6,980 b. Sbx month' 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. Or the $1600 of office supplies purchased on July 4,$310 remains. e Interest expense on the $50,000 loan obtained from the cily council on August 1 should be recorded f. Of the $2,300 of racing supplies purchased on December 12, $140 remains 9 Suzle calculates that the company owes $13,300 in income taxes. 1. Record each of the transactions listed above in the 'General joumar tab (these are shown as items 1 to 27 ). Review the 'General Ledger' and the 'Tral Balance' tabs to see the effect of the transactions on the account balances. 2. Feccird the sojusting entries in the 'General Journar' tab (these are shown as items 28 to 34 ). 3. Review the adjusted Trial Balancel as of Decembec 31,2024 4. Prepare an income statement for the period ended December 31,2024 , in the Income statement tat 5. Prepare 7 statement of stockholder's equity for the period ended December 31,2024 , in the 'Staternent of stockholder's. Equaty'tab. 6.- Prepare a classified balance sheet as of December 31,2024 in the 'Balanco sheet tab. 7. Record the dosing entries in the 'General joumal tab (these afe shown as tems 35 to 37 )
