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Retained earnings: Prepare the Closing Entry

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Retained earnings at 1/1/10 was $100,000 and at 12/31/10 it was $210,000. During 2010, cash dividends of $50,000 were paid and a stock dividend of $40,000 was issued. Both dividends were properly charged to retained earnings.

You are to provide the missing closing entry. Please indicate DR (debit) or CR (credit) to the left of the account title, and place a comma between the account title and the amount of the adjustment.

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The entry will be as follows..

Debit - Income Statement/Summary - ...

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The solution provides closing entry for retained earning.

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Rand Company: Prepare closing entries and determine Retained Earnings balance

See attachment please.

Presented below is an adjusted trial balance for Rand Company, at December 31, 2007.

Cash $ 19,700 Accounts payable $ 15,000
Accounts receivable 20,000 Notes payable 9,000
Prepaid insurance 15,000 Accumulated depreciation?
Equipment 35,000 equipment 14,000
Depreciation expense 7,000 Service revenue 30,000
Dividends 5,500 Common stock 15,000
Advertising expense 1,400 Retained earnings 9,000
Rent expense 800 Unearned service revenue 16,000
Salary expense 1,000
Insurance expense 2,600
$108,000 $108,000
(a) Prepare closing entries for December 31, 2007.

(b) Determine the balance in the Retained Earnings account after the entries have been posted.

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