On December 31, 2019, Krug Company reported pretax income of $120,000 prior to the following adjusting entries:

Depreciation expense: $31,000. Accrued(Earned) service revenues: $29,000. Accrued expenses: $12,000. Used insurance: $9,000; the insurance was initially recorded as prepaid. Rent revenue earned: $7,000; the rent was initially prepaid by the tenant and credited to unearned rent revenue.

How much is Krug's pretax income after adjusting entries?

A. $113,000. B. $104,000.

C. $106,000. D. $128,000.