Question: What effect will the following closing entry have on the retained earnings account? Service Revenue 21,200 Interest Expense 1,350 Operating Expenses 16,700 Retained Earnings 3,150.

  • What effect will the following closing entry have on the retained earnings account? 
  • Service Revenue 21,200 Interest Expense 1,350 Operating Expenses 16,700 Retained Earnings 3,150.

  • A) Retained earnings will remain unchanged. 
  • B) Retained earnings will decrease by $3,150.
  • c) Retained earnings will increase by $3,150. 
  • D) Retained earnings will be transferred to the income statement.

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