This homework assignment is based on the information in chapter 3; analyzing and recording business transactions using Journal Entries. The solution must be presented in the journal entry format:

DEBIT Account First	DEBIT Account Name	DEBIT Dollar Amount
CREDIT Account	CREDIT Account Name		CREDIT Dollar Amount

EACH journal entry requires a brief explanation; see the example below

DR (abbreviation for Debit) Cash 150,000

CR (Abbreviation for Credit) Stockholders Equity 150,000

- Original investment by stockholder; $150,000 received

1.

Prepare the necessary Journal Entry to record the following transaction:

Mr. Otto invested $159,000 in Otto Enterprise; Mr. Otto received Common Stock in exchange.

Note: when items are paid by check use the Cash account

This is worth 20 points and is due Tuesday, March 1st by 11:55 pm.

2.

Prepare the necessary Journal Entry to record the following transaction:

Otto Enterprise sold merchandise sales in the amount of $15,400; these sales were

paid in cash.

3.

Prepare the necessary Journal Entry to record the following transaction:

Otto Enterprise sold merchandise sales in the amount of $7,800; customers put these sales on account.

4.

Prepare the necessary Journal Entry to record the following transaction:

Otto Enterprise received the January invoices for: Telephone Expense - $290, Consulting

Expense - $4,800, Legal Expense - $2,800 and Utilities Expense - $630, and these were all

paid by check.

5.

Prepare the necessary Journal Entry to record the following transaction:

A car was purchased for Otto Enterprise, in the amount, $18,000; 20% was paid in cash

and a promissory note was signed for the remaining balance.

6.

Prepare the necessary Journal Entry to record the following transaction:

Otto Enterprise declared and paid a cash dividend in the amount of $3,800.

7.

Prepare the necessary Journal Entry to record the following transaction:

Otto Enterprise paid their employees by check and the payroll amount totaled $4,100.