Question

The following information applies to the questions displayed below) Tony and Suzie graduate from college in May 2021 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, 2021, Tony and Suzie organize their new company as a corporation, Great Adventures Inc. The articles of incorporation state that the corporation will sell 27,000 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 transactions occur from July 1 through December 31 Jul. Jul. 1 Sell $13,500 of common stock to Sutie. Jul. 1 Sell $13.500 of common stock to Tony Jul. 1 Purchase a one-year insurance policy for $5,640 (1470 per month) to cover injuries to participants during outdoor clinics bul. 2 Pay legal fees of $1,200 associated with incorporation. Jul. 4 Purchase office supplies of $1.300 on account. ul! 7 Pay for advertising of $400 to local newspaper for an upcoming mountain biking in to be held on July 15 Attendees will be charged 50 on the day of the clinic 8Purchase Le mountain bikes, paying $16.500 cash Oul. 15 on the day of the clinic, Great Adventures receives cash of $3,000 from 50 bikers. Tony conducts the mountain biking clinic Jul 22 Because of the success of the First mountain biking clinic, Tony holds another mountain biking clinic and the company receives $9,500 Jul. 24 Pay $930 to a local radio station for advertising to appear imediately. A kayaking clinic will be held on August 10, and attendees can pay 5138 in advance of $150 on the day of the clinic Jul. 30 Great Adventures receives cash of $7.800 in advance from Kayakers for the upcoming kayak olinis Aug. 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 Vears, and 6% annual interest is due each year on July 31. Aug 4 The company purchases 14 kayaks, paying $26,600 cash 10 Twenty additional kayakers pay $3,600 ($150 each), in addition to the $7,800 that was paid in advance only 30, on the day of the clinic. Tony conducts the first kayak clinic Aug. 17 Tory conducts second kayak clinic, and the company receives $11,000 cash. Aug. 24 Office supplies of $1,300 purchased on July 4 are paid in full. Sep To provide better storage of mountain bikes and kayaks when not in use, the company rents a storage shed for

Answer 1

Working in Images:

Retained Earning
Beg Balance			$            -
Dec 31		$   46,710	$   46,710
Dec 31	$          4,100		$   42,610

Please hit LIKE button if this helped. For any further explanation, please put your query in comment, wi Date Account Credit Debit $ Jul 1 Cash 13,500 $ 13,500 Jul 1 Common Stock $ Jul1 Cash 13,500 $ Jul1 Common Stock 13,500 $ Jul 1 Prepaid Insurance 5,640 $ Jul 1 Cash 5,640 $ Jul 2 Legal Fee Expense 1,200 $ Jul 2 Cash 1,200 $ Jul 4 Supplies Accounts Payable 1,300 Jul 4 1,300 Advertising Expense $ Jul 7 400 Cash $ Jul 7 400 $ Jul 8 Equipment (bikes) 16,500 $ Jul 8 Cash 16,500 $ Jul 15 Cash 3,000 $ Jul 15 Mountain Biking Clinic Revenue 3,000 $ Jul 22 Cash 3,500 $ Jul 22 Mountain Biking Clinic Revenue 3,500 Advertising Expense $ Jul 24 930 $ Jul 24 Cash 930 $ Jul 30 Cash 7,800 $ Jul 30 Deferred Revenue 7,800 $ Cash Aug 1 38,000 Note Payable $ 38,000 Aug 1 $ Equipment (kayaks) 26,600 $ Aug 4 Aug 4 Cash 26,600 Aug 10 $ Deferred Revenue 7,800 $ Aug 10 Cash 3,600 $ Kayak Clinic Revenue 11,400 Aug 10 $ Aug 17 Aug 17 Cash 11,000 $ Kayak Clinic Revenue 11,000 Aug 24 Accounts Payable $ 1,300 Cash Aug 24 1,300 $ 3,720 $ Sep 1 Prepaid Rent Cash Sep 1 3,720

$ Cash Sep 21 13,900 Rock Climbing Revenue Sep 21 13,900 Cash Oct 17 19,100 $19,100 Oct 17 Orinteering Clinic Miscellaneous Expense $ Dec 8 1,600 Dec 8 Cash 1,600 Supplies (Racing) Accounts Payable Dec 12 2,800 $ 2,800 Dec 12 Cash Dec 15 20,800 Service Revenue (Racing) Dec 15 20,800 Dec 16 Salaries Expense 1,600 Dec 16 Cash 1,600 Dec 31 Dividends 4,100 Cash Dec 31 4,100 Debit Credit Date Account Depreciation Expense Accumulated Depreciation Dec 31 8,600 Dec 31 8,600 Insurance Expense Dec 31 2,820 Dec 31 Prepaid Insurance 2,820 $ Rent Expense Prepaid Rent Dec 31 1,240 Dec 31 1,240 Supplies Expense Supplies Dec 31 920 $ 920 Dec 31 Dec 31 Interest Expense 950 Interest Payable Dec 31 950 Supplies Expense (Racing) Supplies (Racing) Dec 31 2,530 Dec 31 2,530 $ Income Tax Expense Dec 31 13,200 Income Tax Payable $ Dec 31 13,200

Debit Credit Date Account $ Kayak Clinic Revenue с1 22,400 $ 6,500 $ Mountain Biking Clinic Revenue Orinteering Clinic 19,100 Rock Climbing Revenue Service Revenue (Racing) $ 13,900 20,800 Income Summary 82,700 (To close revenue accounts) $ Income Summary c2 35,990 Salaries Expense 1,600 Depreciation Expense 8,600 Insurance Expense 2,820 1,240 Rent Expense Supplies Expense (Racing) 2,530 Supplies Expense 920 Miscellaneous Expense 1,600 Advertising Expense 1,330 Income Tax Expense 13,200 Interest Expense 950 Legal Fee Expense 1,200 (To close expense account) $ 46,710 Income Summary с3 Retained Earning 46,710 (To close income summary) Retained Earning $ c4 4,100 Dividend 4,100 (To close dividend accounts)