The following information is available for the Higgins Travel Agency.After closing entries are posted,what will be the balance in the Retained earnings account?
A)$75,500.
B)$184,500.
C)$99,500.
D)$160,500.
E)$130,000.

Question

The following information is available for the Higgins Travel Agency.After closing entries are posted,what will be the balance in the Retained earnings account? 
A)$75,500. 
B)$184,500. 
C)$99,500. 
D)$160,500. 
E)$130,000.

Quizplus · Accepted Answer

To find the balance in the Retained Earnings account, we need to add the beginning balance to the net income and subtract the dividends.

Beginning Retained Earnings = $135,000
Net Income = $32,500
Dividends = $7,000

$135,000 + $32,500 - $7,000 = $160,500

Therefore, the balance in the Retained Earnings account after closing entries are posted will be $160,500.

The Following Information Is Available for the Higgins Travel Agency