Gary Meyer graduated from law school in May 1990, and on June 1 began a law practice by investing \(\$ 5,000\) in cash in the practice. He also transferred to the business office equipment having a cash value of \(\$ 8,500\). Then, he completed these additional transactions during June.

June 1 Rented the office of a lawyer who was retiring and paid the rent for June, \(\$ 800\).

1 Moved from home to the law office law books acquired in college. (In other words, invested the books in the practice.) The books had a \(\$ 600\) fair value.

2 Purchased office supplies for cash, \(\$ 120\).

4 Purchased additional law books costing \(\$ 1,500\). Paid \(\$ 500\) in cash and promised to pay the balance within 90 days.

5 Completed legal work for a client and immediately collected \(\$ 500\) for the work done.

10 Completed legal work for Village Bank on credit, \(\$ 1,500\).

15 Purchased additional office supplies on credit, \(\$ 50\).

20 Received \(\$ 1,500\) from Village Bank for the work completed on June 10 .

25 Completed legal work for Astor Realty on credit, \(\$ 1,300\).

30 Made a \(\$ 300\) installment payment on the law books purchased on June 4.

30 Paid the June telephone bill, \(\$ 70\).

30 Paid the office secretary's wages, \(\$ 1,200\).

30 Gary Meyer took \(\$ 1,400\) out of the business for his personal use.

\section*{Required}

1. Arrange the following asset, liability, and owner's equity titles in an equation like Illustration 1-8: Cash; Accounts Receivable; Office Supplies; Law Library; Office Equipment; Accounts Payable, and Gary Meyer, Capital. Leave space for an Explanation column to the right of Gary Meyer, Capital.
2. Show by additions and subtractions the effects of each transaction on the elements of the equation. Show new totals after each transaction. Next to each change in Gary Meyer, Capital, state whether the change was caused by an investment, a revenue, an expense, or a withdrawal.
3. Analyze the items in the last column of the equation and prepare a June income statement for the practice.
4. Prepare a June statement of changes in owner's equity.
5. Prepare a June 30 balance sheet.