Question

Blue Spruce’s Miniature Golf and Driving Range Inc. was opened on March 1 by Bob Dean. These selected events and transactions occurred during March.
Mar. 1 Stockholders invested $58,000 cash in the business in exchange for common stock of the corporation.
3 Purchased Snead’s Golf Land for $38,200 cash. The price consists of land
$24,900, building $8,460, and equipment $4,840.
5 Advertised the opening of the driving range and miniature golf course,
paying advertising expenses of $1,940 cash.
6 Paid cash $4,750 for a 1-year insurance policy.
10 Purchased golf clubs and other equipment for $5,950 from Tahoe Company,
payable in 30 days.
18 Received golf fees of $1,850 in cash from customers for golf services
performed.
19 Sold 100 coupon books for $25 each in cash. Each book contains 10
coupons that enable the holder to play one round of miniature golf or to hit
one bucket of golf balls.
25 Paid a $540 cash dividend.
30 Paid salaries of $850.
30 Paid Tahoe Company in full for equipment purchased on March 10.
31 Received $880 in cash from customers for golf services performed.
Journalize the March transactions. Friendley's records golf fees as service revenue.

Answer 1

Answer:

Blue Spruce's Miniature Golf and Driving Range, Inc.

Journal Entries:

March 1:

Debit Cash Account $58,000

Credit Common Stock $58,000

To record the investment of cash by stockholders.

March 3:

Debit Land $24,900

Debit Building $8,460

Debit Equipment $4,840

Credit Cash Account $38,200

To record the purchase of land, building, and equipment.

March 5:

Debit Advertising Expense $1,940

Credit Cash Account $1,940

To record the payment of advertising expense.

March 6:

Debit Prepaid Insurance $4,750

Credit Cash Account $4,750

To record the prepayment of insurance policy for one year.

March 10:

Debit Golf Clubs and Equipment $5,950

Credit Accounts Payable (Tahoe Company) $5,950

To record the purchase of golf clubs and equipment on account.

March 18:

Debit Cash Account $1,850

Credit Service Revenue $1,850

To record the receipt of golf fees.

March 19:

Debit Cash Account $2,500

Credit Deferred Service Revenue $2,500

To record the sale of 100 coupon books for $25 each.

March 25:

Debit Dividend $540

Credit Cash Account $540

To record the payment of cash dividend.

March 30:

Debit Salaries Expense $850

Credit Cash Account $850

To record the payment of salaries.

March 30:

Debit Accounts Payable (Tahoe Company) $5,950

Credit Cash Account $5,950

To record the payment of cash on account.

March 31:

Debit Cash Account $880

Credit Service Revenue $880

To record the receipt of cash for golf services performed.

Explanation:

The above journal entries are made on a daily basis as business transactions and events take place.  Journal entries are the initial records of business transactions and events.  They identify the accounts to be debited and the accounts to be credited in the general ledger.