Tonys favorite memories of his childhood were the times he spent with his dad at camp. Tony was daydreaming of those days a bit as he and Suzie jogged along a nature trail and came across a wonderful piece of property for sale. He turned to Suzie and said, Ive always wanted to start a camp where families could get away and spend some quality time together. If we just had the money, I know this would be the perfect place. On November 1, 2025, Great Adventures purchased the land by issuing a $500,000, 6%, 10-year installment note to the seller. Payments of $5,551 are required at the end of each month over the life of the 10-year loan. Each monthly payment of $5,551 includes both interest expense and principal payments (i.e., reduction of the loan amount). Late that night, Tony exclaimed, We now have land for our new camp; this has to be the best news ever! Suzie said, Theres something else I need to tell you. Im expecting!

*general journal*

1. Record the issuance of the long-term note payable for the purchase of land in 11/1/25
2. Record the first monthly payment on the long-term note payable, made on 11/30/25
3. Record the second monthly payment on the long-term note payable, made in 12/31/25
4. The 12 monthly payments in 2026 (following year) will reduce the notes balance by an additional $38,014. Record the reclassification of this amount from long-term notes payable to current notes payable.
5. Record the entry to close the revenue accounts.
6. Record the entry to close the expense accounts.

Income Statement

Revenues, Net sales, Gross Profit (expenses), total operating expenses (operating income), income before income taxes

Balance Sheet

Current assets, total current assets, long-term assets

Current liabilities, total current liabilities (long-term liabilities), total liabilities

Stockholders equity