Question

Required information Great Adventures Problem AP2-1 (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, 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, 2021, 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 July for Great Adventures. Jul 1 Sell $10,000 of common stock to Suzie. Jul. 1 Sell $10,000 of common stock to Tony. Jul. 1 Purchase a one-year insurance policy for $4,440 ($370 per month) to cover injuries to participants during outdoor clinics. Jul. 2 Pay legal fees of $1,300 associated with incorporation. Jul. Jul. 7 Pay $340 tefice supplies of $1,600 on account: newspaper for advertising to appear immediately for an upcoming mountain biking clinic to be held on July 15. Attendees will Jul charged $60 the day of the clinic. 8 Purchase 10 mountain bikes, paying $10,700 cash. Jul. 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 $3,600. Jul. 24 Pay $800 to a local radio station for advertising to appear immediately. A kayaking clinic will be held on August 10, and attendees can pay $140 in advance or $190 on the day of the clinic. Jul. 30 Great Adventures receives cash of $7,000 in advance from 50 kayakers for the upcoming kayak clinic. Great Adventures Problem AP2-1 Part 1 Required: 1. Record each transaction in July. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list

Answer 1

1.Journal entries :

(1)	July 1, 2021		Debit	Credit
	Cash	10,000
	Common Stock		10,000
	(Issue common stock to Suzie)
(2)	July 1, 2021
	Cash	10,000
	Common Stock		10,000
	(Issue common stock to Tony)
(3)	July 1, 2021
	Prepaid Insurance	4,440
	Cash		4,440
	(Purchase one-year insurance policy)
(4)	July 2, 2021
	Legal Fees Expense	1,300
	Cash		1,300
	(Pay legal fees for incorporation)
(5)	July 4, 2021
	Supplies (Office)	1,600
	Accounts Payable		1,600
	(Purchase office supplies on account)
(6)	July 7, 2021
	Advertising Expense	340
	Cash		340
	(Pay cash for advertising)
(7)	July 8, 2021
	Equipment (Bikes)	10,700
	Cash		10,700
	(Pay cash for mountain bikes)
(8)	July 15, 2021
	Cash	3,000
	Service Revenue		3,000
	(Receive cash for mountain bike clinic)

(9)	July 22, 2021
	Cash	3,600
	Service Revenue		3,600
	(Receive cash for mountain bike clinic)
(10)	July 24, 2021
	Advertising Expense	800
	Cash		800
	(Pay cash for advertising)
(11)	July 30, 2021
	Cash	7,000
	Unearned Revenue		7,000
	(Receive cash in advance for kayak clinic)