Plumlee Corporation has the following account balances at December 31, 2017.

	Debit	Credit
Service Fees Earned ...		$92,500
Interest Income .		2,200
Salaries Expense	$41,800
Advertising Expense ...	4,300
Depreciation Expense	8,700
Income Tax Expense	9,900
Retained Earnings ..		42,700

Prepare entries to close these accounts in journal entry form. Set up T-accounts for each of the ledger accounts and post the entries to them. After these entries are posted, what is the balance of the Retained Earnings account?

The book answer is $72,700. Please explain how the T accounts is set up.

a. $ 42,700

b. $ 72,700

c. $ 12,700

d. $137,400