What Is the Closing Entry to Allocate Net Income $24,000

question 85

Multiple Choice

What is the closing entry to allocate net income $24,000 to Eric,Von,and Derek? Their respective capital balances are $20,000,$40,000,and $60,000.Net income is shared in a ratio of their capital balances.

• A)Debit Income Summary $24,000; credit Eric,Capital $4,000; credit Von,Capital $8,000; credit Derek,Capital $12,000
• B)Debit Income Summary $24,000; credit Eric,Capital $8,000; credit Von,Capital $8,000; credit Derek,Capital $8,000
• C)Debit Salary Expense $24,000; credit Salaries Payable $24,000
• D)Net income cannot be allocated.

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Definitions:

Behavioral Approach

A method emphasizing the study of observable and measurable behaviors over internal mental states.

Leader Actions

Activities and decisions taken by a person in a leadership position to influence and guide a group towards achieving certain objectives.

Personality Factors

Traits or characteristics that describe an individual's stable patterns of thought, emotion, and behavior.

Follower Actions

Follower Actions refer to the behaviors and reactions of individuals who are being led or influenced by a leader, indicating their level of engagement, support, or resistance.