Question 7 (13 points) If you would like to use a spreadsheet for this question, please click here to have a spreadsheet open in a new tab. Once you are finished, you will need to click the "Click here to save your work" button. This will copy a link to your clipboard, which you can then paste into your answer field below, allowing your instructors to access your spreadsheet Beachburg Equestrian Services Inc. (hereafter "BESI") was formed on July 1, 2020 by two high school friends Sandy Ryder and Sarah Haylifter. The company provides equestrian services such as horse-riding lessons, horse and buggy rides and horse and carriage services for upscale weddings. BESI has decided on a December 31 fiscal year end and to adopt the following accounts in its general ledger: Account Name Cash Accounts receivable Allowance for doubtful accounts Supplies Prepaid expenses Horses Accumulated depreciation: Horses Equipment Accumulated depreciation: Equipment Accounts payable Interest payable Deferred revenue Notes payable - current Notes payable - long term Common shares Retained earnings Sales revenue Bad debt expense Supplies expense Depreciation expense Interest expense Rent expense Wage expense Type (Asset, liability, equity, revenue, expense) Current asset Current asset Current asset contra account Current asset Current asset Non-current asset Non-current asset contra-account Non-current asset Non-current asset contra-account Current liability Current liability Current liability Current liability Non-current liability Equity Equity Revenue Expense Expense Expense Expense Expense Expense Wage expense Expense During the year ended December 31, 2020 the following transactions occurred: Date July 1 July 1 July 1 August 1 Issued 1,000 share each to Sandy and Sarah. In return for her shares, Sandy provided horses with five years remaining in their useful life. The horses had a value of $30,000 and are to be depreciated using the straight line method. The expected residual value of the horses after five years is zero. Sarah provided cash of $30,000 for her shares. BESI rented a farm for the year July 1, 2020 to June 30, 2021 at a total cost of $14,400 all of which was paid on July 1, 2020, Purchased supplies of hay for $6000 cash. Received $18,000 cash for riding lessons to be provided equally each month over the period August 1, 2020 to July 31, 2021, The riding lessons were subsequently provided as scheduled. Purchased equipment for $16,000. The equipment is to depreciated on a straight- line basis over 5 years and is expected to have a residual value of $1,000. Signed a note payable of $16000 to pay for the equipment. The note carries interest at a rate of 10%. The note and the interest are payable on October 1, 2021. Issued an invoice for $5,000 for a wedding event service performed in December. The invoice is due in January 2021. BESI estimates that 5% of all accounts receivable will not be paid and will become uncollectible. Counted hay and determined that there was $2000 worth of hay left. October 1 December 3 December 31 Required Prepare all journal entries necessary to record the above transactions and any necessary December 31 year end adjusting entries. You do not need to provide closing entries. Use only the account names provided. Ignore income and sales taxes. Clearly label whether the number is being debited or credited by putting dr or cr in front of your number