Lynn Barry started her own consulting firm, Barry Consulting, on June 1, 2017. The following transactions occurred during the month of June:

June 1 Sold her shares in Big Country Airlines for $7,000, which she deposited in her personal bank account.

1 Transferred $6,000 from her personal account to a business account in the name of Barry Consulting.

2 Paid $900 for office rent for the month.

3 Purchased $545 of supplies on account.

5 Paid $95 to advertise in the County News.

9 Received $3,275 for services provided.

12 Withdrew $600 for personal use.

15 Performed $5,000 of services on account.

17 Paid $1,800 for employee salaries.

21 Received $3,000 for services provided on account on June 15.

22 Paid for the supplies purchased on account on June 3.

25 Signed a contract to provide consulting services to a client for $5,500. Services will be performed and paid for in July.

26 Borrowed $5,500 from the bank and signed a note payable.

29 Used part of the cash borrowed from the bank on June 26 to purchase equipment for $2,150.

30 Paid $150 for telephone service for the month.

30 Received $2,500 from client for consulting to be provided in July.

Instructions

(a) Prepare a tabular analysis of the effects of the above transactions on the accounting equation.

(b) Calculate profit and owner's equity for the month ended June 30.

(c) Prepare a balance sheet at June30.

TAKING IT FURTHER

How should Lynn determine which transactions should be recorded and which ones should not be recorded?