Question

mester Project - Worth 30 points 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 40,000 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. 1 Bell $20,000 of common stock to Suzie. Jul. 1 Sell $20,000 of common stock to Tony. Jul. 1 Purchase a one-year Insurance policy for $4,200 ($350 per month) to cover injuries to participants during outdoor clinics. Jul. 2 Pay legal fees of $1,300 associated with incorporation. Jul. Purchase office supplies of $1,800 on account. Jul. 7 Pay for advertising of $350 to a local newspaper for an upcoming mountain biking elinie to be held on July 15. Attendees will be charged $60 on the day of the clinic. Jul. Purchase 10 mountain bikes, paying $17.400 cash. Jul. 15 On the day of the clinic, Great Adventures receives cash of $3,000 from 50 bikers. Tony conducts the mountain biking alinie. Jul. 22 Because of the success of the first mountain biking alinie, Tony holds another mountain biking elinie and the company receives $3,600. Jul. 24 Pay $890 to a local radio station for advertising to appear immediately. A kayaking alinie will be held on August 10, and attendees can pay $150 in advance or $200 on the day of the clinie. Jul. 30 Great Adventures receives cash of $7.500 in advance from 50 kayakers for the upcoming kayak elinie. Aug. 1 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 years, and 69 annual interest is due cach year on July 31. Aug. 4 The company purchases 14 kayaks, paying $16,500 cash. Aug. 10 Twenty additional kayakers pay $4,000 (200 each), in addition to the $7.500 that was paid in advance on July 30, on the day of the elinie. Tony conducte the first kayak olinie. Aug. 17 Tony conducta a second kayak elinie, and the company receives $12,100 cash. Aug. 24 Office supplies of $1,800 purchased on July 4 are paid in full. Bep. 1 To provide better storage ot mountain bikes and kayaks when not in use, the company renta a storage Bhed for one year, paying $3,480 ($290 per month) in advance. Sep. 21 Tony conducts arock-climbing elinie. The company receives $14.500 cash. Oct. 17 Tony conducts an orienteering clinic. Participants practice how to understand a topographical map. read an altimeter, use a compass, and orient through heavily wooded areas. The company receives $19,100 cash. Dec. 1 Tony decides to hold the company's first adventure race on December 15. Four-person team will race from checkpoint to checkpoint using a combination of mountain biking, kayaking, orienteering, trail

Answer 1

205 206 Great Adventures Inc. Balance Sheet Dec. 31,2021 207 Liabilities 2,200 211 212 Assets Current Assets Cash Office Supplies Racing Supplies Prepaid Insurance Prepaid Rent Current Liabilities 110,880 Accounts Payable 340 Deferred Revenue 250 Interest Payable 2,100 Income Tax Payable 2,320 Total Current Liabilities Notes Payable 115,890 Total Liabilities Stockholder's Equity 33,900 Common Stock (7,100) Retained Earnings 875 13,200 16,275 35,000 51275 215 216 218 Total Current Assets Long TermAssets Equipment Less Accumulated Depreciation 40,000 51,415 220 Total Stockholder's Equity 142690 Total Liabilities and Stockholder's Equity 91415 142690 Total Assets 224 225