A Merchandiser Uses a Perpetual Inventory System

A merchandiser uses a perpetual inventory system. The beginning Capital balance of a merchandiser was $100,000. During the year, sales revenue amounted to $75,000, sales returns and allowances were $1,000, sales discounts were $3,000, cost of goods sold was $40,000, and all other expenses totaled $10,000. The total withdrawals amounted to $25,000.The last step in the closing process would include:

A) a debit to Income Summary for $54,000.
B) a credit to Income Summary for $75,000.
C) a debit to Owner's Name, Capital for $21,000.
D) a debit to Owner's Name, Capital for $25,000.

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