Klein Interiors has the following account balances at the end of the year. Use only the appropriate accounts to prepare a balance sheet.

Accounts Balances

Equipment $ 81,500

Accounts payable 13,600

Common stock 24,600

Service revenue 50,400

Cash 6,200

Retained earnings?

Salaries expense 31,600

Notes payable 22,300

RE = 27,200

Explanation:

We will calculate the Retained Earnings using the accounting equation.

Assets = Liab + Equity

Assests:

cash 6,200

equipment 81,500

total assets; 87,700

Liabilities:

Account Payable 13,600

Notes Payable 22,300

Total Laibilities 35,900

Equity:

Common stock 24,600

RE: X

We will plug these values int o the accounting equatio nand solve for retained earnings.

Assets = Liab + Equity

87,700 = 35,900 + 24,600 + Retained Earnings

87,700 - 35,900 - 24,600 = RE

RE = 27,200