Company A sells blankets The following transactions occurred

Company A sells blankets. The following transactions occurred during March:

Mar 3

Placed an order on credit with the blanket supplier for 100 blankets at a price of $70 each.

Mar 7

Hired a new employee. The employee will earn $80,000 per year plus benefits.

Mar 17

Received the order placed on March 3. No payment is yet made to the supplier.

Mar 25

Sold 60 of the blankets purchased on March 3. The sale was on credit.  

Mar 28

Received half of the payment for the March 25 sale.

There were five events in the month of March. How many of them do not require a journal entry to be made?

Select one:
a. One
b. Two
c. Three
d. Four

Solution

There are 5 transaction in march but only 3 are required to pass journal entry.

Because hiring an employee is a not a transaction but if company pays salary to him in march then only is required to pass journal entry.

Similarly receiving order is not required to pass journal entry.

The reason there is no sale or sale revenue. Only a record will be kept by company in order register