Ken Serratore Decides to Open a Cleaning and Laundry Service

Essay

Ken Serratore decides to open a cleaning and laundry service near the local college campus that will operate as a proprietorship. The transactions for the month of June are listed below:
1. Ken Serratore invests $20,000 in cash to start a cleaning and laundry business on June 1.
2. Purchased laundry equipment for $5,000 paying $3,000 in cash and the remainder due in 30 days.
3. Purchased laundry supplies for $1,200 cash.
4. Received a bill from Campus News for $300 for advertising in the campus newspaper.
5. Cash revenue from customers for cleaning and laundry amounted to $1,500.
6. Paid salaries of $200 to student workers.
7. Billed the Tiger Football Team $100 for cleaning and laundry services.
8. Paid $300 to Campus News for advertising that was previously billed in Transaction 4.
9. Ken Serratore withdrew $700 from the business for living expenses.
10. Incurred utility expenses for month on account, $400.
Instructions
Analyze the transactions above in terms of their effect on the basic accounting equation. Record each transaction by increasing (+) or decreasing (-) the dollar amount of each item affected. Total and balance the equation at the end of the month.