Reference no: EM132768653

Here is the end of year account balance information from the accounting records of Jaunty Coffee Company:

Sales revenue: $10,000
Cash: $400
Cost of goods sold: $9,000
Accounts payable: $1,100
Capital stock: $2,000
Dividends: $700
Retained earnings (beginning): $1,000
Inventory: $4,000

Problem 1: Which debit or credit would appear in the closing entries for the year?

A. Credit to inventory for $4,000
B. Credit to cost of goods sold for $9,000
C. Credit to sales revenue for $10,000
D. Debit to dividends for $700