THE ABOVE TRANSACTIONS NEED TO BE RECORDED Great Adventures Problem 3-1 IThe fol
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THE ABOVE TRANSACTIONS NEED TO BE RECORDED
Great Adventures Problem 3-1 IThe following information applies to the questions displayed belo The following transactions occur over the remainder of the year Aug. 1 Great Adventures obtains a $38,000 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 Aug. 4 The company purchases 14 kayaks, costing $19,600 Aug. 10 Twenty additional kayakers pay $3,200 ($160 each), in addition to the $7,700 that was paid in advance on July 30, on the day of the clinic. Tony conducts the first kayak clinic Aug. 17 Tony conducts a second kayak clinic, and the company receives $10,500 cash Aug. 24 Office supplies of $1,600 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, purchasing a one-year rental policy for $3,120 ($260 per month) Sep. 21 Tony conducts a rock-climbing clinic. The company receives $14,000 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. Clinic fees total $19,600 Dec. 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 $500Explanation / Answer
Adjusting entry no. Account Titles Debit Credit $ $ 1. Depreciation expense 7,900 Equipment 7,900 2. Insurance expense 2,760 Prepaid insurance 2,760 3. Rent expense ??? Prepaid rent ??? 4. Supplies (Office) expense 1,370 Supplies (Office) 1,370 5. Interest expense 38,000 Interest payable 38,000 6. Supplies(Racing) expense 1,710 Supplies(Racing) 1,710 7. Income tax expense 14,400 Income tax payable 14,400
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