7. ERNEST Corporation has the following income statement for the year ended December 31.

Sales $750,000

Rent Expense $105,000

Salaries Expense 425,000

Utilities Expense 11,000

Dividend Revenue 4,500

Depreciation Expense 16,500

Interest Expense 9,500

Income Tax Expense 38,000

Gain on Sale of Equipment 6,000

Insurance Expense 23,000 Required:

Prepare the necessary closing entries for December 31.