A company declared and paid a dividend of $10,400 this year. The entry to close the Dividends account at the end of the year will include a debit to:

Dividends and a credit to cash for $10,400.

Retained earnings and a credit to dividends for $10,400.

Dividends and a credit to retained earnings for $10,400.

Dividends and a credit to dividends payable for $10,400.