Question

The following financial information was taken from the books ofRandy's gym, a small fitness club:

Accounts Receivable

$12,450

Accounts Payable

6,200

Salaries Payable

3,150

Cash

36,750

Dividends

2,000

Operating expenses

35,300

Prepaid Rent

1,200

Rent Expense

8,400

Retained Earnings 1/1/2015

41,250

Salaries Expense

14,500

Service Revenue

65,400

Supplies

650

Supplies Expense

3,150

Common Stock

7,000

Unearned Revenue

6,400

Land

15,000

a. Prepare the journal entries necessary to close the temporaryaccounts at December 31, 2015 for Randy's gym and spa

b. What is the balance in the Retained Earnings account afterthe closing entries are posted?

 

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