The Following Is the Adjusted Trial Balance for Baker Services

question 165

Multiple Choice

The following is the adjusted trial balance for Baker Services. $\begin{array}{|c|c|c|}\hline \text { Accounts } & \text { Debit } & \text { Credit } \\\hline \text { Cash } & \$ 34,000 & \\\hline \text { Accounts Receivable } & 28,000 & \\\hline \text { Prepaid Insurance } & 7,500 & \\\hline \text { Office Supplies } & 3,000 & \\\hline \text { Land } & 48,000 & \\\hline \text { Building } & 150,000 & \\\hline \text { Accumulated Depreciation-Building } & & \$ 15,500 \\\hline \text { Equipment } & 71,000 & \\\hline \text { Accumulated Depreciation-Equipment } & & 7,000 \\\hline \text { Accounts Payable } & & 23,000 \\\hline \text { Salaries Payable } & & 4,000 \\\hline \text { Unearned Revenue } & & 29,000 \\\hline \text { Mortgage Payable } & & 100,000 \\\hline \text { Common Stock } & & 10,000 \\\hline \text { Retained Earnings } & & 11,500 \\\hline \text { Dividends } & 22,000 & \\\hline \text { Service Revenue } & & 280,000 \\\hline \text { Salaries Expense } & 62,000 & \\\hline \begin{array}{l}\text { Depreciation Expense-Building and } \\\text { Equipment }\end{array} & 5,900 & \\\hline \text { Supplies Expense } & 14,000 & \\\hline \text { Insurance Expense } & 14,600 & \\\hline \text { Utilities Expense } & 20,000 & \\\hline \text { Total } & \$ 480,000 & \$ 480,000 \\\hline\end{array}$ After the closing entries are posted, what is the balance in Retained Earnings?

• A) $22,000
• B) $185,000
• C) $21,500
• D) $153,000

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Definitions:

Manufacturers

Manufacturers are entities engaged in the industrial production of goods from raw materials through the use of machinery and labor.

Market

A place or mechanism where buyers and sellers converge to trade goods, services, or resources.

Production Possibility Frontier

A curve representing the maximum combinations of goods or services that can be produced with limited resources.

Bowed Out

A description usually of production possibilities frontier that shows increasing opportunity costs.