S & T Adventures, Incorporated Sarah and Tommy have graduated and want to start their own outdoor activities business. They plan to focus on biking and kayaking for the first three year and then evaluate for growth. Their articles of incorporation state that the corporation will sell 20,000 shares of common stock for $1.00 each. The following are their transactions for July 2018. July Sell S10,000 of common stock to Sarah. July Sell S10,000 of common stock to Tommy. Julyl July 2 Pay legal fees of S1,500 associated with incorporation. July 4Purchase office supplies of $1,800 on account. July 7 Pay for advertising of $300 to a local paper for July Clinic. July 8Prchase 10 mountain bikes, paid S12,000 cash. July 15 On the day of the clinic, 40 bikers paid a total of $2,000. Tommy conducted the clinic July 22 A second clinic is offered and earned $2,300 in cash for S & TAdventures. July 24 700 to a local radio station for advertising for a kayaking clinic to be held in August. July 30 40 kayakers pay a total of $4,000 for the August 10th Kayaking Clinic Purchase a once-year insurance policy for $4,800 to cover the business. hint: this is being paid in advance of the activity) Step 1: Record the transactions in the General Journal. Step 2: Post the information from the General Journal to the Ledgers Step 3: Create a Trial Balance for the month of July. (Check figure: Trial Balance should be $30,100) Step 4: Continue on with the rest of 2018 transactions. Aug 1 S&T Adventures obtains a $30,000 loan, due in three years with a 6% interest rate. Aug4The company purchases 14 Kayaks, paying $28,000 in cash. Aug 10 Kayaking Clinic- Reccived $3,000 in cash, in addition to the $4,000 prepaid on July 30th. Aug 17 Tommy offers a sccond Kayaking Clinic and the company receives $10,500 cash. Aug 24Office supplics of S1,800 purchased on July 4 are paid in full Sep. The company rents a storage shed for one year, paid $2,400 in advance. Sep. 2 The company receives $13,200 cash for a clinic. Oct. 17 The company receives $17,900 cash for a clinic. Dec. 1 Tommy decides to hold an adventure race on Dec.15th. checkpoint to checkpoint. The entry fee for each team is $500. Tommy hires Victor to promote the race. Victor will be paid S50 in salary for every team that completes. His salary will be paid after the race. Four-person teams will race from Dec. 5 Dec. 8The company pays S1,200 to purchase a permit to use a state park for the race. (Misc. Exp) Dec. 12 The company purchases racing supplies for $2,800 on account due in 30 days. Dec. 15 A total of 40 teams sign up and the company receives $20,000 cash and the race is held Dec. 16 Victor is paid $2,000 for his salary Dec. 3 The company pays dividends of S4,000. (S2000 to Sarah and $2000 to Tommy) Step 5: Recotransactions in the General Journal. Step 6: Post the information from the General Jouranl to the Ledgers. Step 7: Record the following adjusting entries to the journal and post to the ledgers. a. Depreciation for all equipment totals $8,000. b. Six months' worth of insurance has expired c. Four months' worth of rent has expired d. Of the S1,800 of office supplics purchased on July 4, $300 remains. e. Interest expense on the $30,000 loan should be recorded. f. Of the $2,800 of racing supplics purchased on Dec. 12, $200 remains. g. Sarah calculates that the company owes S14,000 in income taxes. Step 8: Prepare an Adjusted Trial Balance. Step 9: Prepare the financial statements Step 10: Jounalize all Closing Entries and post results to Ledgers. Step 1 Prepare the Post-Closing Trial Balance ASSETS OWNER 300 Common 310 Retained 320 Dividend EXPENSES 100 Cash 110 Prepaid Insu 115 Prepaid Rent 20 Supplies (Of 125 Supplies (Ra 130 Equipment (I 135 Equipment ( 140 Accumulated Depr 500 Advertising Expense 505 Depreciation Expense 510 Income Tax Expense 515 Insurance Expense 520 Interest Expense 525 Legal 530 Miscellaneous Expense 535 Rent Expense 540 Salaries Expense 545 Supplies Expense-Office 550 Supplies Expense Racing REVENUE 400 Service R 410 Service R Fees Expense LIABILITIES 200 Accounts Payable 210 Deferred Revenue 220 Income Tax I 230 Interest Payable 240 Notes Payable