Question # 3. Listed below are five terms followed by a list of
phrases that describe or characterize each of the terms. Match each
phrase with the correct term.
TERM
PHRASE
Number for
term that
matches the
phrase.
1. General ledger
Refers to the right side of an account.
____
2. Credit
Asset and expense accounts normally have this type of
balance.
____
3. General journal
Used to record any type of transaction in chronological
order.
____
4. Debit
Contains all the accounts of an entity.
____
5. Closing entries
Used to reset temporary accounts to a zero balance.
____
Question # 4. Prepare journal entries to record the following
transactions of Daisy King Ice Cream Company. If an entry is not
required, state "No Entry."
1. Started business by issuing 10,000 shares of capital stock for
$20,000.
2. Signed a franchise agreement to pay royalties of 5% of
sales.
3. Leased a building for three years at $500 per month and paid six
months' rent in advance.
4. Purchased equipment for $5,400, paying $1,000 down and signing a
two-year, 10% note for the balance.
5. Purchased $1,800 of supplies on account.
6. Recorded cash sales of $800 for the first week.
7. Paid weekly salaries and wages, $320.
8. Paid for supplies purchased in item (5).
9. Paid royalties due on first week's sales.
10. Recorded depreciation on equipment, $50.