Great Adventures Problem 10-1 [The following information applies to the questions displayed below.) Tony and Suzie purchased land costing $500,000 for a new camp in January 2020. Now they need money to build the cabins, dining facility, a ropes course, and an outdoor swimming pool. Tony and Suzie first checked with Summit Bank to see if they could borrow another million dollars, but unfortunately the bank turned them down as too risky. Undeterred, they promoted their idea to close friends they had made through the outdoor clinics and TEAM events. They decided to go ahead and sell shares of stock in the company to raise the additional funds for the camp, Great Adventures has two classes of stock authorized: 996, $10 par preferred, and $1 par value common. When the company began on July 1, 2018, Tony and Suzie each purchased 12,500 shares of $1 par value common stock at $1 per share. The following transactions affect stockholders' equity during 2020, its third year of operations: July 2 Issue an additional 110,000 shares of common stock for $12 per share September 10 Repurchase 11,000 shares of its own common stock (i.e., treasury stock) for $15 per share November 15 Reissue 5,500 shares of treasury stock at $16 per share December 1 Declare a cash dividend on its common stock of $129,500 ($1 per share) to all stockholders of record on December 15 December 31 Pay the cash dividend declared on December 1. Great Adventures Problem 10-1 Part 1 Required 1. Record each of these transactions. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list View journal entry worksheet Date General Journal Debit Credit 1July 02, 2020 Cash 1,320,000 Common stock 110,000 1,210,000 Additional paid-in capital September 165,000 10, 2020 Treasury stock Cash 165,000 November 88,000 15, 2020Cash Treasury stock Additional paid-in capital 82,500 5,500 December 01,2020 Dividends 4 129,500 Dividends payable 129,500 December Dividends payable 31, 2020 129,500 Cash 129,500 Great Adventures Problem 10-1 Part 2 2. Great Adventures has net income of $157,000 in 2020. Retained earnings at the beginning of 2020 was $147,000. Prepare the stockholders' equity section of the balance sheet for Great Adventures as of December 31, 2020. (Amounts to be deducted should be indicated with a minus sign.) GREAT ADVENTURES, INC Balance Sheet (Stockholders' Equity Section) December 31, 2020 Stockholders' equity: Common stock Additional paid-in capital Preferred stock $135,000 1,215,000 0 Total paid-in capital Retained earnings Treasury stock 1,350,000 188,000 82,500 Total stockholders' equity $ 1,620,500
