On December 31, 2018, immediately after all the adjustments were made to Gilbert Inc.'s accounting records for the 2018 fiscal year, but before the books were closed, the retained earnings account reflected a balance of $85,000. The sum of the pre-closing balances of all of Gilbert's temporary accounts was a net debit balance of $10,000. Gilbert paid no dividends during 2018. On the balance sheet for January 1, 2019, the balance in the retained earnings account will be

Question

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The net debit balance of $10,000 in temporary accounts indicates a net loss for the year, which reduces retained earnings from $85,000 to $75,000.

On December 31, 2018, Immediately After All the Adjustments Were