The following trial balance was taken from the books of Fisk Corporation on December 31, 2020.

Account Debit Credit

Cash $ 9,000

Accounts Receivable 40,000

Notes Receivable 10,000

Inventory 34,000

Prepaid Insurance 4,800

Equipment 100,000

Accumulated Depreciation--Equip. 15,000

Accounts Payable 12,600

Common Stock 44,000

Retained Earnings 55,000

Sales Revenue 260,000

Cost of Goods Sold 126,000

Salaries and Wages Expense 50,000

Rent Expense 12,800

Totals $386,600 386,600

At year end, the following items have not yet been recorded:

1) Estimated bad debts, 5% of accounts receivable.

2) Depreciation on equipment, 10% per year on original cost.

3) Interest at 6% is receivable on the note for one full year.

Assume that the firm uses the Allowance For Doubtful Accounts

Questions:

(a) Prepare the necessary adjusting entries.

(b) Prepare the necessary closing entries. Then, compute ending balance of Retained Earnings? Show your calculation.