Crowe Company began operations on January 1, Year 1. The company was organized as a sole proprietorship. During Year 1, Crowe acquired $40,000 of capital from John Crowe, the owner. Also, during Year 1 the company earned net income of $20,000 and John Crowe withdrew $15,000 from the business. Based on this information, the Company would show 

•  $5,000 in its capital account on the Year 1 balance sheet. 
• $40,000 in its capital account on the Year 1 balance sheet. 
• $45,000 in its capital account on the Year 1 balance sheet. 
• $25,000 in its capital account on the Year 1 balance sheet.

Answer rating: 100% (QA)

The company would show 25000 in its capital account on the Year 1 balance sheet Here is the breakdo... View the full answer