Tony and Suzie graduate from college in May 2021 and begin developing their new business. They begin by offering clinics for basic outdoor bctivitios such as mountain bling or kayaking. Upon developing a customer base, they'll hold theit 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, 2021, Tony and Suzie organize their new company as a corporation, Great Adventures inc. The articles of incorporation state that the corporation will sell 20,000 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 folowing transactions occur from July 1 through December 31 . Jut. 1 Sel1 s1e, 80e of comeon stock to suzie. 3ul. 1 Sell s1e, eed of conon stock to Tony. Jul. 1 Purchase one-year insurance policy for $4,820 (\$4ee per nonth) to cover injuries to participants during eutdoor clinics. 3ut. 2 Pay legal tees of 51,50e associated with incorporation. Jui, 4 Purchsse office suppiies of 51,890 on account. Jul, 7 Pay for advertising of 5300 to a locat newspoper for an upconing aountain biking clinic to be hetd on July 15. Attendees will be charged 550 on the day of the clinic. Jul. B Purchase 10 mountain bikes, paying $12, 090 cash. 3ul. 15On the day of the clinic, Great Mdventures receives cash of 52,906 from 40 bikers. Tony conducts the bountain biking clinic. 1ul. 22 Because of the success of the first mountain biking ctinic, Tany holds another ecuntain biking elinic and the conpany recelves $2,360. Jot. 24 Pay 370 to to a locat radio station for advertising to appear insediately. A kayakang ctinic wit1 be held on Aggust 12 , and attendees can pay s1ee in advance or 5150 on the day of the clinic. Jol. 3a Great Adventures, receives cash of $4, , be in advance fren 40 kyyakers for the upconing kayak ctinte. Aug, 1 Great Adventures obtains a $30, eve low-iaterest loan fer the cobpany fron the city council, which has receatly passed an initiative encouragieg business developeent related to outdoor activities. The toan is due in three years, and 6s annual interest is due each year on july31. Aog. 4 The corpany purchases 14 kayaks, puying 528 , vee cash. Aug. 10 Tuenty asditional kayakers pay $3, eee (sise each), In oddition to the $4,00a that was pasd in advance on July 3e, on the day of the clinic. Tony conducts the first kayak clinic. Aug. 17 Toey conducts a second kayak clinie, and the compasy receives 110,500 cash. Au9. 24 otrice supplies of $1, beg purchased on Juty 4 are pald in fu11. Sep. I To provide better storage of sountain bikes and kayaks when not in use, the cospany rents a storage Sep, 21. Toed for the year, paying - 52,400 (s2e0 per nonth) in advance. Sep, 21 Toby cenducts a reck-cliebing clinic. The cotpany receives $13,200 cash. read ah altiket or ienteering clinic. Participants practice now to underatand a tspographical aag, 517, 920 cash. Dec, 1 Tony decifes to hald the conpany's tirst adventure race on Deceaber 15. four-person teass with race frem checkpoint to checkpoint using a coepination of sountain biking, kayaking, orienteering, trait rytning, and rock-ctiebles skits. The first toon in each category to coeptete all checkpothts in bec. 5 brder wint. The entry fee for each tean is isee. Dec. 1 Tony decides to hold the company's first adventure race on December 15 , Four-person teams will race fron checkpoint to checkpoint using a combination of mountain biking, kayaking, orienteering, trail running, and rock-clinbing skills. The first tean in each category to complete all checkpoints in order wins. The entry fee for each tean is $509. Dec. 5 . To help organize and pronote the race, Tony hires his college roommate, Victor. Victor will be paid $50 in salary for each tean that conpetes in the race. His salary will be paid after the race. Dec, 8 The company pays $1,206 to purchase a permit from a state park where the race will be held. The amount is recorded as a aiscellaneous expense. Dec, 12 The company purchases racing supplies for $2,800 on account due in 30 days. 5 upplies include trophies for the top-finishing teans in each category, pronotional shirts, 5nack. foods and drinks for participants, and field markers to prepare the racecourse. Dec, 15 The conpany receives $20,900 cash fron a total of forty teans, and the race is held. Dec, 16 The compony pays Victor's salary of $2,009. Dec. 31 The conpony pays a dividend of $4,600($2,000 to Tony and $2, eee to 5uz1e). Dec. 31 Using his personal money, Tony purchases a diamond ring for s4,500, Tony surprises 5 uzie by proposing. 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 58,000. 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 oxpired. d. Of the $1,600 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 caiculates that the company cwes $14,000 in income taxes. 3. Post transactions from July 1 through December 31 and adjusting entries on December 31 to T-accounts. Answer is not complete. 7 poutis Part 3 of 5 7 Part 3 at 5 7 poests