The Net Income of Sarah for the Year Is $25,000

Multiple Choice

The Net Income of Sarah for the year is $25,000. The withdrawals Sarah made during the year amounted to $30,000. Which of the following statements is true of effect of these transactions on Sarah, Capital?

A) Sarah, Capital account decreases by $25,000.
B) Sarah, Capital account decreases by $5,000.
C) Sarah, Capital account increases by $30,000.
D) Sarah, Capital account increases by $25,000.