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?

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