QUESTION 6

1. Ellis had the following select account balances at year end, 12/31/20.

   Cash Prepaid Rent	50,000 24,000	Accumulated Depreciation Allowance for Doubtful Accounts	35,000 2,000
   Sales Revenue	492,000	Cost of Goods Sold	284,000
   Salaries Expense	80,000	Accounts Receivable	12,000
   Unearned Revenue	6,000	Interest Revenue	4,000
   Gain on Sale of Land Retained Earnings (Jan 1)	8,000 80,000	Depreciation Expense Dividends	20,000 15,000

   Which of the following statements is correct regarding the first closing entry that should be made?

   	A.	Retained Earnings is credited for $496,000.
   	B.	Retained Earnings is debited for $496,000.
   	C.	Retained Earnings is debited for $504,000.
   	D.	Retained Earnings is credited for $504,000.