EXERCISE 3-17A

Exercise 3-17A Pr e paring closing entries

The following financial information was taken from the books of Zone Health Club, a small spa

and fitness club:

Account Balances as of December 31, 2016

Accounts Receivable $12,450

Accounts Payable 6,200

Salaries Payable 3,150

Cash 36,750

Dividends 2,000

Operating Expense 35,300

Prepaid Rent 1,200

Rent Expense 8,400

Retained Earnings 1/1/2016 41,250

Salaries Expense 14,500

Service Revenue 65,400

Supplies 650

Supplies Expense 3,150

Common Stock 7,000

Unearned Revenue 6,400

Land 15,000

Required

a. Prepare the journal entries necessary to close the temporary accounts at December 31, 2016,

for Zone Health Club.

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