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, theyll 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, 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 following business activities occur during the year for Great Adventures. July 1 Sell $12,000 of common stock to Suzie. July 1 Sell $12,000 of common stock to Tony. July 1 Purchase a one-year insurance policy for $1,500 ($125 per month) to cover injuries to participants during outdoor clinics. July 2 Pay legal fees of $1,600 associated with incorporation. July 4 Purchase office supplies of $900 on account. July 7 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 $125 the day of the clinic. July 8 Purchase 10 mountain bikes, paying $18,000 cash. July 15 On the day of the clinic, Great Adventures receives cash of $5,000 from 40 bikers. Tony conducts the mountain biking clinic. July 22 Because of the success of the first mountain biking clinic, Tony holds another mountain biking clinic, and the company receives $5,000. July 24 Pay $750 to a local radio station for advertising to appear immediately. A kayaking clinic will be held on August 10, and attendees can pay $125 in advance or $175 on the day of the clinic. July 30 Great Adventures receives cash of $5,000 in advance from 40 kayakers for the upcoming kayak clinic. Aug 1 Great Adventures obtains a $35,000 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. 2 BBUS 210 Financial Accounting Project 1 Developing Financial Statements Aug 4 The company purchases 14 kayaks, paying $28,000 cash. Aug 10 Twenty additional kayakers pay $3,500 ($175 each), in addition to the $5,000 that was paid in advance on July 30, on the day of the clinic. Tony conducts the first kayak clinic. Aug 17 Tony conducts a second kayak clinic, and the company receives $10,500 cash. Aug 24 Office supplies of $900 purchased on July 4 are paid in full. Sep 1 To provide better storage of mountain bikes and kayaks when not in use, the company rents a storage shed for one year, paying $3,000 ($250 per month) in advance. Sep 21 Tony conducts a rock-climbing clinic. The company receives $15,000 cash. Oct 17 Tony conducts 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 $17,900 cash. Dec 1 Tony decides to hold the companys 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 team in each category to complete all checkpoints in order wins. The entry fee for each team is $500. Dec 5 To help organize and promote the race, Tony hires his college roommate, Victor. Victor will be paid $150 in salary for each team that competes in the race. His salary will be paid after the race. Dec 8 The company pays $1,200 to purchase a permit from a state park where the race will be held. The amount is recorded as a miscellaneous expense. Dec 12 The company purchases racing supplies for $4,500 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 field markers to prepare the racecourse. Dec 15 The company receives $20,000 cash from a total of forty teams, and the race is held. Dec 16 The company pays Victors salary of $6,000. Dec 31 The company pays a dividend of $6,000 ($3,000 to Tony and $3,000 to Suzie). Dec 31 Using his personal money, Tony purchases a diamond ring for $20,000. Tony surprises Suzie 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, 2024. a. Depreciation of the mountain bikes purchased on July 8th, useful life 10 years. b. Depreciation of kayaks purchased on August 4th, useful life 10 years. c. Six months of the one-year insurance policy purchased on July 1 has expired. 3 BBUS 210 Financial Accounting Project 1 Developing Financial Statements d. Four months of the one-year rental agreement purchased on September 1 has expired. e. Of the $900 of office supplies purchased on July 4, $300 remains. f. Interest expense on the $35,000 loan obtained from the city council on August 1 should be recorded. g. Of the $4,500 of racing supplies purchased on December 12, $2,000 remains. h. Suzie calculates that the company owes $16,000 in income taxes. Required: 1. Record transactions (journal entries) from July 1 through December 31. 2. Post transactions from July 1 through December 31 to General Ledger (T-Accounts). 3. Prepare trial balance. 4. Record adjusting entries as of December 31, 2024. 5. Post adjusting entries on December 31 to T-Accounts. 6. Prepare an adjusted trial balance as of December 31, 2024. 7. For the period July 1 to December 31, 2024, prepare an income statement, statement of stockholders equity, and a classified balance sheet as of December 31, 2024. 8. Record closing entries as of December 31, 2024. 9. Post-closing entries to T-Accounts. 10. Prepare a post-closing trial balance as of December 31, 2024