Question

Question 5

Pharoah Miniature Golf and Driving Range Inc. was opened on March 1 by Michael Wear. These selected events and transactions occurred during March.

Mar.	1		Shareholders invested $45,800 cash in the business in exchange for common shares of the corporation.
	3		Purchased Arnie's Golf Land for $36,200 cash. The price consists of land $21,100, building $9,000, and equipment $6,100.
	5		Advertised the opening of the driving range and miniature golf course, paying advertising expenses of $1,800 cash.
	6		Paid cash $2,300 for a 1-year insurance policy.
	10		Purchased golf clubs and other equipment for $4,200 from Golden Bear Company, payable in 30 days.
	18		Received golf fees of $1,000 in cash from customers for golf fees earned.
	19		Sold 100 coupon books for $27 each in cash. Each book contains ten coupons that enable the holder to play one round of miniature golf or to hit one bucket of golf balls. (Hint: The revenue is not earned until the customers use the coupons.)
	25		Declared and paid a $460 cash dividend.
	30		Paid salaries of $700.
	30		Paid Golden Bear Company in full for equipment purchased on March 10.
	31		Received $820 in cash from customers for golf fees earned.
	31		Paid estimated income taxes for the month amounting to $100.

The company uses these accounts: Cash, Prepaid Insurance, Land, Buildings, Equipment, Accounts Payable, Unearned Revenue, Common Shares, Retained Earnings, Dividends Declared, Service Revenue, Advertising Expense, Salaries Expense, and Income Tax Expense.

Prepare journal entries to record the March transactions. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Record journal entries in the order presented in the problem.)

DATE	Account Titles and Explanation	Debit	Credit
*insert date*
MAR 3
*insert date*
*insert date*
*insert date*
*insert date*
*insert date*
*insert date*
*insert date*

__________

__________________________

_____

_____

(To record payment of salaries)

DATE	Account Titles and Explanation	DEBIT	CREDIT
*insert date*

(To record payment of equipment purchased)

DATE	Account Titles and Explanation	DEBIT	CREDIT
*insert date*

(To record cash received from customers)

DATE	Account Titles and Explanation	DEBIT	CREDIT
*insert date*

(To record payment of income tax)

DATE	Account Titles and Explanation	DEBIT	CREDIT
*insert date*

Answer 1

Journal Entries:

Date	Account title and explanation	Debit	Credit
Mar.1	Cash	$45,800
	Common stock		$45,800
	[To record issuance of common stock]
Mar.3	Land	$21,100
	Building	$9,000
	Equipment	$6,100
	Cash		$36,200
	[To record purchase of land,building and equipment]
Mar.5	Advertising expense	$1,800
	Cash		$1,800
	[To record payment of advertising expense]
Mar.6	Prepaid insurance	$2,300
	Cash		$2,300
	[To record cash paid in advance for insurance]
Mar.10	Equipment	$4,200
	Accounts payable		$4,200
	[To record purchase of golf clubs and other equipment]
Mar.18	Cash	$1,000
	Service revenue		$1,000
	[To record cash received from customers]
Mar.19	Cash (100 x $27)	$2,700
	Unearned revenue		$2,700
	[To record cash received in advance from customers]
Mar.25	Cash dividends	$460
	Cash		$460
	[To record payment of cash dividends]
Mar.30	Salaries expense	$700
	Cash		$700
	[To record salaries expense]
Mar.30	Accounts payable	$4,200
	Cash		$4,200
	[To record cash paid for accounts payable]
Mar.31	Cash	$820
	Service revenue		$820
	[To record cash received from customers]
Mar.31	Income tax expense	$100
	Cash		$100
	[To record payment of income tax]