3. Below is the Adjusted Trial Balance for Lexington Inc., at December 31, 2020:

(10 pts.)

	DEBIT	CREDIT
Cash	6,500
Accounts receivable	12,000
Prepaid rent	9,000
Prepaid insurance	7,000
Equipment	15,000
Accumulated depreciation equip.		4,000
Land	7,000
Salaries payable		5,000
Notes payable		12,000
Interest payable		1,000
Common stock		15,000
Retained earnings (a)		5,000
Dividends	500
Sales		60,000
Cost of goods sold	30,000
Supplies expense	1,000
Rent expense	5,000
Insurance expense	4,000
Depreciation expense	2,000
Salaries expense	3,000
Totals	102,000	102,000

1. Retained earnings balance on January 1, 2020.

Required: (1) Record, in the General Journal, the 3 closing entries at

December 31, 2020.

(2) Compute the Retained Earnings account balance at

December 31, 2020.