Question

roject On July 1, 2021, Tony and Surie organize their new company as a corporation, Great Adventures inc. The articles of incorporation state that the corporation will sell 34,000 shares of common stock for steach. 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 1 Sell $17.000 of een steek to Susie 1 Sell $17.00 of common stock to Tony. Jul. 1 Purchase a one-year insurance polley for 5.640 (20 per month to cover injuries to participants during outdoor elinies. Jul. 2 Pay legal fee of $1,600 seated with incorporation Jul. 4 Purchase office supplies of $1.00 en account. 7 May for advertising of $330 to a local newspaper for an upcoming mountain biking cline to be held on July 15. Attendees will be charged 30 on the day of the elite. • Purchase 10 mountain bikes, paying $15,00 cash. Jul 15 on the day of the elinie, Great Adventures receives cash of $2,400 from bikers. Tony conducte the mountain biking elinie. Jul. 22 Because of the success of the first mountain biking cline, Tony holds another mountain biking clinic and the company receives $2,750. Jul. 24 May 6730 to a local radio station for advertising to appear immediately. A kayaking line will be held on August 10, and attendees can pay 5120 in advance or $170 on the day of the clinic Jul. 30 Great Adventures receives cash of 57,200 in advance from 60 kayakers for the upcoming kayak eliste. Aug. 1 Great Adventures obtain a $47,000 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 64 annual interest is de each year on July 1. Aug. 4 The company purchases 14 kayaks, paying $22,000 cash. Rag. 10 Twenty addicional kayakers pay $3,400 15170 each), in addition to the $1,200 that was paid in advance on July 10, on the day of the elinie. Tony conducta the first kayak elinie Aug. 17 Tony conducte second kayak elinie, and the company receives $13,500 cash. Rag. 24 office supplier of $1,800 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 $3,480 ($290 per month) in advance. Sep. 21 Tony conducte a rock climbing clinic. The company receives $14,800 cash. Oct. 17 Tony conduct an orienteering clinic. Participante practice how to understand topographical map. read an altimeter, use a compass, and orient through heavily wooded areas. The company receives 513,100 cash. Dee. Tomy decides to hold the company' thuat adventure race on December 15. Tour person team will race from checkpoint to checkpoint wing 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 pala $30 in salary for each team that compete in the race. Wie salary will be paid after the race. Dee. The company pays $1,500 to purchase permit from a state park where the race will be held. The amount is recorded as a miscellaneous expense. Dee. 12 The company purchases racing supplies for $2,300 on account due in 30 days. Supplies include trophies for the top-cincahing teams in each category, promotional shirts, snack food and drinks for participants, and field markere to prepare the racecourse. Dec. 15 The company receives 520.000 cash from a total of forty teans, and the race is held. Dec. 16 The company pays Victor's salary of $1,200. Dec. 31 The company pays a dividend of $3,200 $1,600 to Tony and 51, 60D to Bule). Dec. 31 Deing his personal money, Tony purchases a diamond ring for 65,000. Tony surprises Sale by proposing that they get married. Burie accepts and they get married The following information relates to year-end adjusting entries as of December 31, 2021 a. Depreciation of the mountain bikes purchased on July 8 and kayaks purchased on August 4 totals $7,600. b. Six months of the one-year Insurance policy purchased on July 1 has expired. c. Four months of the one-year rental agreement purchased on September 1 has expired. d. or the $1,800 of office supplies purchased on July 4, $210 remains e. Interest expense on the $47,000 loan obtained from the city council on August 1 should be recorded. for the $2,300 of racing supplies purchased on December 12. $130 remains 9. Suzie calculates that the company owes $14,100 in income taxes. Tequired: Record transactions from July 1 through December 31, of no entry is required for a transaction/event, select "No journal entry required in the first account field.) Prey 2 3 4

Answer 1

R S Debit Credit 1200 1200 3200 3200 А B B с D E F G н тук L M No P Q 2 Date Particulars Debit Credit Date Particulars Debit Credit Date Particulars Debit Credit Date Particulars 3 1-Jul Cash 34000 22-Jul Cash 2750 24-Aug Accounts payable 2400 16-Dec Salary expense 4 Common Stock 34000 Service revenue 2750 Cash 2400 Cash 5 (Being common stock sold to susy and tony) (Being service provided) (Being accoutnts payable paid) (Being expense paid) 6 7 1-Jul Prepaid insurance 5040 24-Jul Advertisement expense 730 1-Sep Prepaid rent 3480 31-Dec Dividend 8 Cash 5040 Cash 730 Cash 3480 Cash 9 (Being on yr insurance policy purchased (Being expenses paid) (Being rent paid in advance) ( (Being dividend paid) 10 11 2-Jul Incorporation expenses 1600 30-Jul Cash 7200 21-Sep Cash 14800 31-Dec 12 Cash 1600 Advance from customers 7200 Service revenue 14800 13 (Being expenses paid) (Being advances received) (Being service provided) 14 15 4-Jul Office supplies 1800 1-Aug Cash 47000 17-Oct Cash 19100 16 Accounts payable 1800 6% Loan 47000 Service revenue 19100 17 (Being supplies bought) (Being money borrowd) (Being service provided) 18 19 7-Jul Advertising expense 330 4-Aug Kayak 22000 8-Dec Miscelleneous exp 1500 - 20 Cash 330 Cash 22000 Cash 1500 21 (Being expenses paid) (Being Kayaks bought) (Being permit fees paid) 22 23 8-Jul Mountain bikes 15600 10-Aug Cash 3400 12-Dec Supplies 2300 24 Cash 15600 Advances from customer 7200 Accounts Payable 2300 - 25 (Being bikes bought) Service revenue 10600 (Being supplies bought) 26 (Being revenue recognised) 27 15-Jul Cash 2400 15-Dec Cash 20000 28 Service revenue 2400 17-Aug Cash 12500 Service revenue 20000 29 (Being service provided) Service revenue 12500 (Being service provided) 30 (Being service provided)

32 ADJUSTING ENTRIES 33 Date Particulars Debit Credit 34 31-Dec Depreciation 7600 35 Accumulated depreciation 7600 36 37 31-Dec Insurance ecpense 2520 38 Prepaid insurance 2520 39 40 31-Dec Rent expense 1160 41 Prepaid rent 1160 42 43 31-Dec Supplies expense 1590 44 Supplies 1590 45 46 31-Dec Interest expense 1410 47 Interest payable 1410 48 49 31-Dec Supplies expense 2170 50 Supplies 2170 51 52 31-Dec Income tax expense 14100 53 Income tax payable 14100 54