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Tony and Suzie see the need for a rugged all - terrain vehicle to transport participants and supplies. They decide to purchase a used Suburban
Tony and Suzie see the need for a rugged allterrain vehicle to transport participants and supplies. They decide to purchase a used Suburban on July for $ They expect to use the Suburban for five years and then sell the vehicle for $ The following expenditures related to the vehicle were also made on July : The company pays $ toGEICOfor a oneyear insurance policy. The company spends an extra $ to repaint the vehicle, placing the Great Adventures logo on the front hood, back, and both sides. An additional $ is spent on a deluxe roof rack and a trailer hitch.The painting, roof rack, and hitch are all expected to increase the future benefits of the vehicle for Great Adventures. In addition, on October the company pays $ for basic vehicle maintenance related to changing the oil, replacing the windshield wipers, rotating the tires, and inserting a new air filter.RWPStatic Great Adventures Continuing Case Part Record the expenditures related to the vehicle on July Note: The capitalized cost of the vehicle is recorded in the Equipment accountRWPStatic Great Adventures Continuing Case Part Record the expenditure related to vehicle maintenance on October RWPStatic Great Adventures Continuing Case Part Prepare a depreciation schedule using the straightline method.RWPStatic Great Adventures Continuing Case Part Record the depreciation expense and any other adjusting entries related to the vehicle on December If no entry is required for a transactionevent select No Journal Entry Required" in the first account field.RWPStatic Great Adventures Continuing Case Part Required:Record the sale of the vehicle two years later on July for $If no entry is required for a transactionevent select No Journal Entry Required" in the first account field.RWPStatic Great Adventures Continuing Case Part Required:Record each of the transactions above on December jornal worksheet questions: Additional interest for five months needs to be accrued on the $ note payable obtained on August Recall that annual interest is paid each July Record the adjusting entry. Assume that $ of the $ note discussed above is due next year. Record the entry to reclassify the current portion of the longterm note. By the end of the year, $ in gift cards have been redeemed. The company had sold gift cards of $ during the year and recorded those as Deferred Revenue. Record the adjusting entry. Great Adventures is a defendant in litigation involving a biking accident during one of its adventure races. The company believes the likelihood of payment occurring is probable, and the estimated amount to be paid is $ Record the adjusting entry. For sales of MU watches, Great Adventures offers a warranty against defect for one year. At the end of the year, the company estimates future warranty costs to be $ Record the adjusting entry.RWPStatic Great Adventures Continuing Case Part If the likelihood of payment for the litigation is determined to be reasonably possible, what should Great Adventures record for this possible payment.
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