The following financial information was taken from the books of Better Shape Health Club, a small spa and health club.

Required

a. Prepare the journal entries necessary to close the temporary accounts at December 31, 2011, the Better Shape Health Club.

b. What is the balance in the Retained Earnings account after the closing entries are posted?

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Account Balances as of December 31, 2011 Accounts Receivable $16,150 Accounts Payable 5,500 Salaries Payable 2,150 Cash 20,725 Dividends 1,750 Operating Expense 31,550 Prepaid Rent 600 Rent Expense 4,200 Retained Earnings 1/1/2011 32,650 Salaries Expense 11,200 Service Revenue 48,400 Supplies 450 Supplies Expense 4,240 Common Stock 6,515 Unearned Revenue 8,050 Land 12,400