Required Information Great Adventures Problem AP3-1 [The following information applies to the questions displayed below.) Tony and Suzie graduate from college in May 2021 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, orienteering, and trail running. In the long run, they plan to sell outdoor gear and develop a ropes course for outdoor enthusiasts. On July 1, 2021. Tony and Suzie organize their new company as a corporation, Great Adventures Inc. The articles of incorporation state that the corporation will sell 21,000 shares of common stock for $1 each. Each share of stock represents a unit of ownership. Tony and Suzle will act as co-presidents of the company. The following transactions occur from July 1 through December 31. Jul. 1 Sell $10,500 of common stock to Suzie. Jul. 1 Sell $10.500 of common stock to Tony. Jul. i Purchase a one-year Insurance policy for $4,440 ($370 per month) to cover injuries to participants during outdoor clinics. Jul. 2 Pay legal fees of $1,700 associated with incorporation Jul. 4 Purchase office supplies of $1,500 on account. Jul. 7 pay for advertising of $370 to a local newspaper for an upcoming mountain biking clinic to be held on July 15. Attendees will be charged $50 on the day of the clinic. Jul. 8 Purchase 10 mountain bikes, paying $19,400 cash. Jul. 15 On the day of the clinic, Croat Adventures receives cash of $4,000 from 80 bikers. Tony conducts the mountain biking clinic. Jul. 22 Because of the success of the first mountain biking clinic, Tony holds another mountain biking clinic and the company receives $4,300. Jul. 24 Pay $900 to a local radio station for advertising to appear immediately. A kayaking clinic will be held on August 10, and attendees can pay $150 in advance or $200 on the day of the elinie. Jul. 30 Great Adventures receives cash of $12,000 in advance from 80 kayakers for the upcoming kayak elinie. Aug. 1 Great Adventures obtains a 536,000 low-interest loan for the company from the city council, which has recently passed an initiative encouraging business development related to outdoor activities. The loan is due in three years, and 69 annual interest is due each year on July 31. Aug. 4 The company purchase 14 kayaks, paving $19,500 cash. Aug. 10 twenty additional kayakers pay $4.000 (8200 cach), in addition to the $12.000 that was paid in advance on July 30, on the day of the clinic. Tony conducts the first kayak clinic. Aug. 17 Tony conducts a second kayak clinic, and the company receives $11,400 cash. Aug. 24 Office supplies of $1,500 purchased on July 4 are paid in full. Sep. 1 To provide better storage of mountain bikes and kayaks when not in use, the company rents a storage shed for one year, paying $3,600 ($300 per month) in advance. Sep. 21 Tony conducta a rock-climbing clinic. The company receives $14,100 cash. oct. 17 Tony conducts an orienteering clinic. Participants practice how to understand a topographical map, read an altimeter, use a compass, and orient through heavily wooded areas. The company receives $18,300 cash. Dec. 1 Tony decides to hold the company's first adventure race on December 15. Four-person teams will race from checkpoint to checkpoint using a combination of mountain biking, kayaking, orienteering, trail running, and rock-climbing skills. The first team in each category to complete all checkpoints in order wins. The entry fee for each team is $550. Dec. 5 To help organize and promote the race, Tony hires his college roommate, Victor. Victor will be paid $70 in salary for each team that competes in the race. His salary will be paid after the race. Dec. The company pays $1,000 to purchase a permit from a state park where the race will be held. The Dec. 12 The company purchases racing supplies for $2,700 on account due in 30 days. Supplies include trophies for the top-finishing teams in each category, promotional shirts, snack food and drinks for participants, and field markers to prepare the racecourse. Dec. 15 The company receives $22,000 cash from a total of forty teams, and the race in held. Dec. 16 The company pays Victor's salary of $2,800. Dec. 31 The company pays a dividend of $3,200 ($1,600 to Tony and $1,600 to Suzie). Dec. 31 uning his personal money, Tony purchases a diamond ring for $4,100. Tony surprise Suzie by proponing that they get married. Suzie accepts and they get married The following information relates to year-end adjusting entries as of December 31, 2021. a. Depreciation of the mountain bikes purchased on July 8 and kayaks purchased on August 4 totals $8,700 b. Six months 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. Of the $1,500 of office supplies purchased on July 4, $360 remains. e. Interest expense on the $36,000 loan obtained from the city council on August 1 should be recorded. f. Of the $2,700 of racing supplies purchased on December 12. $220 remains. 9. Suzie calculates that the company owes $13,200 in income taxes - Great Adventures Problem AP3-1 Part 6 6. Record closing entries as of December 31, 2021. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) Answer is not complete. No General Journal Debit Credit Date Dec 31, 2021 1 Service Revenue (Racing) Retained Earnings 2 Dec 31, 2021 Retained Earnings Salaries Expense Advertising Expense Rent Expense Utilities Expense OOO 3 Dec 31, 2021 Retained Earnings Dividends Great Adventures Problem AP3-1 Part 7 7. Post the closing entries of retained earnings to the T-account. Retained Earnings 0 0 Beg. Bal. End. Bal. Great Adventures Problem AP3-1 Part 8 8. Prepare a post-closing trial balance as of December 31, 2021. Answer is not complete. Credit $ GREAT ADVENTURES, Inc. Post-closing Trial Balance December 31, 2021 Accounts Debit Cash 88,690 Prepaid Insurance 2.220 Prepaid Rent 2.400 Supplies (Office) 360 Supplies (Racing) 220 Equipment (Bikes) 19,400 Equipment (Kayaks) 19,500 Accumulated Depreciation Accounts Payable Income Tax Payable Interest Payable Notes Payable Common Stock Retained Earnings Dividends 8,700 2,700 13,200 900 36,000 21,000 OU