RWP3-1 (Static) Great Adventures Continuing Problem (GL) 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, theyil 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 trall 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 32,000 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. Juty 1 Setl sie,00e of compon stock to Suzie. July 1 Sell $10,000 of common stock to Tony, July 1 Purchase a one-year insurance policy for $4,800 (\$4ee per month) to cover injuries to participants during Juty 2 Pay legal fees of $1,5e0 associated with incorporation. Juty 4 Purchase office supplies of $1, gee on account. July 7 Pay $360 to a local newspaper for advertising to appear immediately for an upcosing nountain biking clinic to be held on July 15 . Attendees will be charged $5 e the day of the clinic. July 8 Purchase 10 mountain bikes, paying $12, eee cash. July 15 On the day of the clinic, Great Adventures receives cash of s2, eee in total fron 40 bikers. Tony and Suzie Juty 22 Beccause of the success of the first nountain biking clinic, Tony and suzie hold another nountain biking clinic and the conpany receives $2,300. July 24 Pay $7e0 to a local radio station for advertising to appear imediately, A kayaking clinic witl be held on August 10 , and attendees can pay $100 in advance or $150 on the day of the clinic. July 30 Great Adventures receives total cash of 54, ,ee in advance fron 40 kayakers for the upconing kayak clinfc. The following transactions occur over the resainder of 2024 . August 1 Great Adventures obtains a $30, eee low-interest loan for the conpany fros the city council, which has recently passed an initiative encouraging business developent related to outdoor activities. The loan is due in three years, and 64 annual interest is due each year on July 31. August 4 The cospany purchases 14 kayaks, paying $28, eee cash. August 10 Tony and Suzie conduct the first kayak clinic. In addition to the $4,000 that was received in advance froe kayakers on July 30 , the coepany receives additional cash of $3,600 from 20 ned kayakers on the day of the ctinic. August 17 Tony and surie conduct a second kayak clinic, and the cospany receives \$1e, se0 cash. September 21 Tony and Suzie conduct a rock-climbing clinic. The company receives $13,200 cash. October 17 Tony and Suzie conduct an orienteering clinic. Participants practice how to understand a topographical map, read an altimeter, use a conpass, and orient through heavily wooded areas. The conpany receives $17,900 cash. December 1 Tony and Suzle decide to hold the conpany'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 tean in each category to complete all checkpoints in order wins. The entry fee for each team is $500. December 5 To help organize and promote the race, Tony hires his college roommate, Victor. Victor will be paid $58 in salary for each tean that competes in the race. His salary will be paid after the race. December 8 The company pays $1,200 to purchase a permit from a state park where the race will be held. The anount is recorded as a miscellaneous expense. December 12 The company purchases racing supplies for $2, 800 on account due in 30 days. Supplies include trophies for the top-finishing teams in each category, promotional shirts, snack foods and drinks for participants, and fleld markers to prepare the racecourse. Deceaber 15 The conpany receives $20,000 cash from a total of forty teams, and the race is held. December 16 The company pays victor's salary of $2,000. December 31 The company pays a dividend of $4,000 ( $2,000 to Tony and $2,000 to 54zie). Decenbdo 31 Using his personal money, Tony purchases a diamond ring for s4,5e0. Tony surprises Suzie by proposing that income 5tatement married. Suzie accepts and they get married! The following information relates to year-end adjusting entries as of December 31,2024. a. Depreciation of the mountain bikes purchased on July 8 and kayaks purchased on August 4 totals $8,000. 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 $1,800 of office supplies purchased on July 4,$300 remains. e. Interest expense on the $30,000 loan obtained from the city council on August 1 should be recorded. f. Of the $2,800 of racing supplies purchased on December 12,$200 remains. 9. Suzie calculates that the company owes $14,000 in income taxes. Prepare the journal entries for transactions. (If no entry is required for a transacton/event, select "No journal entry required" in the first account field) December 31 Using his personal money, Tony purchases a diamond ring for $4,500. Tony surprises Suzie by proposing tha they get married. Suzie accepts and they get married! The following information relates to year-end adjusting entries as of December 31, 2024. a. Depreciation of the mountain bikes purchased on July 8 and kayaks purchased on August 4 totals $8,000. 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 $1,800 of office supplies purchased on July 4,$300 remains. e. Interest expense on the $30,000 loan obtained from the city council on August 1 should be recorded. f. Of the $2,800 of racing supplies purchased on December 12,$200 remains. g. Suzie calculates that the company owes $14,000 in income taxes. 1. Record each of the transactions listed above in the 'General Journal' tab (these are shown as items 1 to 27). Review the 'General Ledger' and the 'Trial Balance' tabs to see the effect of the transactions on the account balances. 2. Record the adjusting entries in the 'General Journal' tab (these are shown as items 28 to 34 ). 3. Review the adjusted 'Trial Balance' as of December 31, 2024. 3. Review the adjusted 'Trial Balance' as of December 31,2024 , 4. Prepare an income statement for the period ended December 31,2024 , in the 'Income Statement' tab. 4. Prepare an income statement for the period ended December 31,2024 , in the 'Income 5 tatement' tab. 5. Prepare a statement of stockholder's equity for the period ended December 31,2024 , in the 'Statement of Stockholder's Equity'tab. Equity' tab. 6. Prepare a classified balance sheet as of December 31,2024 in the 'Balance Sheet' tab. 6. Prepare a classified balance sheet as of December 31 , 2024 in the balance 7. Record the closing entries in the 'General Journal' tab (these are shown as items 35 to 37 )