The following information is available for the Travis Travel Agency. After the closing entries have been journalized and posted, what will be the balance in the Retained Earnings account? $$\begin{array} { | l | r | }
\hline \text { Total reverues } & \$ 125,000 \
\hline \text { Total expenses } & 60,000 \
\hline \text { Retairied earnirgs } & \mathbf { 8 0 , 0 0 0 } \
\hline \text { Dividends } & 15,000 \
\hline
\end{array}$$
A) $65,000
B) $80,000
C) $130,000
D) $145,000
E) $280,000

Question

The following information is available for the Travis Travel Agency. After the closing entries have been journalized and posted, what will be the balance in the Retained Earnings account? $$\begin{array} { | l | r | } 
\hline \text { Total reverues } & \$ 125,000 \
\hline \text { Total expenses } & 60,000 \
\hline \text { Retairied earnirgs } & \mathbf { 8 0 , 0 0 0 } \
\hline \text { Dividends } & 15,000 \
\hline
\end{array}$$
A) $65,000
B) $80,000
C) $130,000
D) $145,000
E) $280,000

Quizplus · Accepted Answer

The balance in the Retained Earnings account after closing entries is calculated as: Beginning Retained Earnings ($80,000) + Net Income ($125,000 - $60,000 = $65,000) - Dividends ($15,000) = $130,000.

The Following Information Is Available for the Travis Travel Agency