Gerdes Psychological Services, Inc., closes its temporary accounts once each year on December 31. The company recently issued the following income statement as part of its annual report:

a. The firm’s statement of retained earnings indicates that a $6,000 cash dividend was declared and paid during 2011.
b. Prepare the necessary closing entries on December 31, 2011.
If the firm’s Retained Earnings account had a $92,000 balance on January 1, 2011, at what amount should Retained Earnings be reported in the firm’s balance sheet dated December 31,2011?

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GERDES PSYCHOLOGICAL SERVICES, INC. INCOME STATEMENT FOR THE YEAR ENDED DECEMBER 31, 2011 Revenue Counseling revenue $225,000 Expenses Advertising expense ······ Salaries expense Office supplies expense- . . .. Utilities expense Malpractice insurance expense Office rent expense.... Continuing education expense .. Depreciation expense : fixtures. Miscellaneous expense Income taxes expense. - .. $1,800 94,000 1,200 850 6,000 .24,000 2,650 4,500 6,000 29,400 170,400 S 54,600 Net income