Sharon Marsh practiced law with a partnership for ten years after graduating from law school. Recently she resigned her position to open her own law office, which she operates as a proprietorship. The name of the new entity is Sharon Marsh. Attorney. Marsh experienced the following events during the organizing phase of her new business and its first month of operation. Some of the events were personal and did not affect the law practice. Others were business transactions and should be accounted for by the business. July 1 2 3 5 6 7 9 23 30 31 Required Marsh sold 1.000 shares of Eastman Kodak stock, which she had owned for sev- eral years, receiving $68.000 cash from her stockbroker. Marsh deposited the $68.000 cash from sale of the Eastman Kodak stock in her personal bank account. Marsh received $170,000 cash from her former law-firm partners. Marsh deposited $100.000 cash in a new business bank account entitled Sharon Marsh, Attorney. A representative of a large company telephoned Marsh and told her of the company's intention to transfer its legal business to the new entity of Sharon Marsh, Attorney. Marsh paid $450 cash for letterhead stationery for her new law office. Marsh purchased office furniture for the law office, agreeing to pay the account payable. $9,500, within three months. Marsh finished court hearings on behalf of a client and submitted her bill for legal services. $3,000. She expected to collect from this client within one month. Marsh paid office rent, $1,900. Marsh withdrew $5,500 cash from the business for personal living expenses. 1. Classify each of these events as one of the following:

a. A business transaction to be accounted for by the proprietorship of Sharon Marsh. Attorney.

b. A business-related event but not a transaction to be accounted for by the proprietor- ship of Sharon Marsh, Attorney

c. A personal transaction not to be accounted for by the proprietorship of Sharon Marsh. Attorney. 2. Analyze the effects of the preceding events on the accounting equation of the proprietor- ship of Sharon Marsh, Attorney. Use a format similar to Exhibit 1-6.