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, 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, 2024, Tony and Suzie organize their new company as a corporation, Great Adventures Incorporated The articles of incorporation state that the corporation will sell 31,000 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 July 1 July 1 July 1 July 2 July 4 July 7 8 July July 15 July 22 July 24 July 30 August 1 August 4 August 10 August 17 August 24 September 1 Sell $15,500 of common stock to Suzie. Sell $15,500 of common stock to Tony. Purchase a one-year insurance policy for $4,440 ($370 per month) to cover injuries to participants during outdoor September 21 October 17 December 1 December 5 clinics. Pay legal fees of $1,400 associated with incorporation. Purchase office supplies of $1,100 on account. Pay $350 to a local newspaper for advertising to appear immediately for an upcoming mountain biking clinic to be held on July 15. Attendees will be charged $30 on the day of the clinic. Purchase 10 mountain bikes, paying $13,800 cash. On the day of the clinic, Great Adventures receives cash of $2,100 from 70 bikers. Tony and Suzie 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 $2,600. Pay $890 to a local radio station for advertising to appear immediately. A kayaking clinic will be held on August 10, and attendees can pay $120 in advance or $170 on the day of the clinic. Great Adventures receives cash of $8,400 in advance from 70 kayakers for the upcoming kayak clinic. The following transactions occur over the remainder of 2024, Great Adventures obtains a $36,000 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 6% annual interest is due each year on July 31. The company purchases 14 kayaks, paying $19,500 cash. Tony and Suzie conduct the first kayak clinic. In addition to the $8,400 that was received in advance from kayakers on July 30, the company receives additional cash of $3,400 from 20 new kayakers on the day of the clinic. Tony and Suzie conducts a second kayak cliate, and the company receives $11,200 cash. office supplies of $1,100 purchased on July 4 are paid in full. to provide better storage of mountain bikes and kayaks when not in use, the company rents a storage shed for one year, paying $2,640 ($220 per month) in advance. Tony and Suzie conduct a rock climbing clinic. The company receives $13,500 cash. Tony and Suzie conduct an orienteering clinie. Participants practice how to understand a topographical map, read an altineter, use a compass, and oelent through heavily wooded areas. The company receives $18,600 kcash. Tony and Suzie decide to hold the company's first adventure Face 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 $690. to help organize and promote the race, Tony hires his college roommate, Victor. Victor will be paid $30 in salary for each tras that competes in the race. His salary will be paid after the race. Prov 1 of 2 Next >>