Net income for Susan's Treasures is $25,000 for the current year. The owner withdrew $3,000 per month for personal living expenses. The owner's Capital account will show a net
A) decrease of $11,000.
B) increase of $61,000.
C) decrease of $36,000.
D) increase of $11,000.
E) increase of $36,000.

Question

Quizplus · Accepted Answer

The net income of $25,000 increases the owner's capital, but the owner withdrew $3,000 per month for 12 months, totaling $36,000 in withdrawals. The net effect is a decrease in the owner's capital account ($25,000 - $36,000 = -$11,000).

Net Income for Susan's Treasures Is $25,000 for the Current