Place the hinge at the desired spot on the work piece. Use the chisel to score an outline of the hinge (Image 1).
Remove the hinge. Dig into the outline with the chisel (Image 2). The depth of the cut should correspond with hinge's thickness.
Use the chisel to carve out the wood inside the outlines of the hinge. Make the cut as deep as the hinge is thick.
Use the chisel to scrape away excess wood shavings.
Screw the hinge into place.
Use an old tennis ball to store a chisel. Slice the ball with a utility knife, and place the sharp edge of the tool inside the ball.