The Net Income Agreement for Crosby and Stills States Net

question 37

Multiple Choice

The net income agreement for Crosby and Stills states net income and net loss shall be divided in a ratio of beginning capital balances.The net loss for the current year is $50,000.On January 1 of the current year,the capital balances were as follows: Crosby,$55,000; and Stills,$65,000.During the current year Crosby withdrew $40,000 and Stills withdrew $25,000.Compute the capital balances as of December 31 of the current year.

• A) \[\begin{array} { | c | c | }
• \hline \text { Crosby, capital } & \text { Stills, capital } \\
• \hline \text { debit of } \$ 7,917 & \text { debit of } \$ 12,917 \\
• \hline
• \end{array}\]
• B) \[\begin{array} { | l | c | }
• \hline \text { Crosby, capital } & \text { Stills, capital } \\
• \hline \text { credit of } \$ 7,917 & \text { credit of } \$ 12,917 \\
• \hline
• \end{array}\]
• C) \[\begin{array} { | c | c | }
• \hline \text { Crosby, capital } & \text { Stills, capital } \\
• \hline \text { debit of } \$ 7,917 & \text { credit of } \$ 12,917 \\
• \hline
• \end{array}\]
• D) \[\begin{array} { | c | c | }
• \hline \text { Crosby, capital } & \text { Stills, capital } \\
• \hline \text { debit of } \$ 12,917 & \text { credit of } \$ 7,917 \\
• \hline
• \end{array}\]

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Definitions:

Aronson and Carlsmith

Researchers known for their work in social psychology, particularly for studies on cognitive dissonance.

Punishment

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