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Tony and Suzie graduate from college in May 2 0 2 4 and begin developing their new business. They begin by offering clinics for basic
Tony and Suzie graduate from college in May 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 fourperson 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 Tony and Suzie organize their new company as a corporation, Great Adventures Incorporated The articles of incorporation state that the corporation will sell shares of common stock for $ each. Each share of stock represents a unit of ownership. Tony and Suzie will act as copresidents of the company. The following business activities occur during July for Great Adventures.
July Sell $ of common stock to Suzie.
July Sell $ of common stock to Tony.
July Purchase a oneyear insurance policy for $ $ per month to cover injuries to participants during outdoor clinics.
July Pay legal fees of $ as sociated with incorporation.
July Purchase office supplies of $ on account.
July Pay $ to a local newspaper for advertising to appear immediately for an upcoming mountain biking clinic to be held on July Attendees will be charged $ on the day of the clinic.
July Purchase mountain bikes, paying $ cash.
July On the day of the clinic, Great Adventures receives cash of $ in total from bikers. Tony and Suzie
July conducts the mountain biking clinic.
Because of the success of the first mountain biking clinic, Tony and Suzie holds another mountain biking clinic and the company receives $
July Pay $ to a local radio station for advertising to appear immediately. A kayaking clinic will be held on August and attendees can pay $ in advance or $ on the day of the clinic.
July Great Adventures receives total cash of $ in advance from kayakers for the upcoming kayak clinic.
The following transactions occur over the remainder of
August Great Adventures obtains a $ lowinterest 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 annual interest is due each year on July
August The company purchases kayaks, paying $ cash.
August Tony and Suzie conduct the first kayak clinic. In addition to the $ that was received in advance from
clinic.
August Tony and Suzie conducts a second kayak clinic, and the company receives $ cash.
August Office supplies of $ purchased on July are paid in full.
September To provide better storage of mountain bikes and kayaks when not in use, the company rents a storage shed for one year, paying $ $ per month in advance.
September Tony and Suzie conduct a rockclimbing clinic. The company receives $ cash.
October Tony and Suzie conduct 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 $ cash.
December Tony and Suzie decide to hold the company's first adventure race on December Fourperson teams will race from checkpoint to checkpoint using a combination of mountain biking, kayaking, orienteering, trail running, and rockclimbing skills. The first team in each category to complete all checkpoints in order wins. The entry fee for each team is $
December To help organize and promote the race, Tony hires his college roommate, Victor. Victor will be paid $ in salary for each team that competes in the race. His salary will be paid after the race.
December The company pays $ to purchase a permit from a state park where the race will be held. The amount is recorded as a miscellaneous expense.
December The company pu
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