Beruflich Dokumente
Kultur Dokumente
You may refer to the opening story of Tony and Suzie and their decision to start Great
Adventures in AP 1-1. More of their story and the first set of transactions for the company in July
are presented in AP 2-1 and repeated here.
1 Purchase a one-year insurance policy for $4,800 ($400 per month) to cover injuries to
participants during outdoor clinics.
Pay for advertising of $300 to a local newspaper for an upcoming mountain biking clinic to be
held on July 15. Attendees will be charged $50 the day of the clinic. 8 Purchase 10 mountain
bikes, paying $12,000 cash.
15 On the day of the clinic, Great Adventures receives cash of $2,000 from 40 bikers.
22 Because of the success of the first mountain biking clinic, Tony holds another mountain
biking clinic and the company receives $2,300.
24 Pay for advertising of $700 to a local radio station for a kayaking clinic to be held on August
10. Attendees can pay $100 in advance or $150 on the day of the clinic.
30 Great Adventures receives cash of $4,000 in advance from 40 kayakers for the upcoming
kayak clinic.
Aug. 1 Great Adventures obtains a $30,000 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 6% annual interest is due each year on
July 31. The company purchases 14 kayaks, paying $28,000 cash.
Aug. 17 Tony conducts a second kayak clinic, and the company receives $10,500 cash.
Sep. 1 To provide better storage of mountain bikes and kayaks when not in use, the company
rents a storage shed, purchasing a one-year rental policy for $2,400 ($200 per month).
Sep. 21 Tony conducts a rock-climbing clinic. The company receives $13,200 cash.
Dec. 1 Tony decides to hold the company's first adventure race on December 15. Four-person
teams will race from checkpoint to checkpoint using a 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 paid $50 in salary for each team that competes in the race. His salary will be paid
after the race.
Dec. 8 The Company pays $1,200 to purchase a permit from a state park where the race will be
held. The amount is recorded as a miscellaneous expense.
Dec. 12 The company purchases racing supplies for $2,800 on account due in 30 days.
Supplies include trophies for the top-finishing teams in each category, promotional shirts, snack
foods and drinks for participants, and field markers to prepare the racecourse.
Dec. 15 The company receives $20,000 cash from a total of forty teams, and the race is held.
Dec. 16 The company pays Victor's salary of $2,000.
Dec. 31 The company pays a dividend of $4,000 ($2,000 to Tony and $2,000 to Suzie).
Dec. 31 Using his personal money, Tony purchases a diamond ring for $4,500. Tony surprises
Suzie by proposing that they get married. Suzie accepts and they get married!
The following information relates to year-end adjusting entries as of December 31, 2018.
a. Depreciation of the mountain bikes purchased on July 8 and kayaks purchased on August 4
totals $8,000.
e. Interest expense on the $30,000 loan obtained from the city council on August 1 should be
recorded.
Required:
3. Post transactions from July 1 through December 31 and adjusting entries on December 31 to
T-accounts.
5. For the period July 1 to December 31, 2018, prepare an income statement and statement of
stockholders' equity. Prepare a classified balance sheet as of December 31, 2018.
ANSWER
https://solvedquest.com/you-may-refer-to-the-opening-story-of-tony-and/