Megan, a colledge student, receives a $6,000 scholarship. She uses it for the following expenses:

Tuition $3,000

Room and Board $2,000

Books $500

Incidental living expenses $500

How much can Megan exclude from income?

A)$2,000

B)$3,500

C)$5,000

D)$5,500

E)$6,000