A partnership begins its first year with the following capital balances:

Alfred, Capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 50,000

Bernard, Capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60,000

Collins, Capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70,000

The articles of partnership stipulate that profits and losses be assigned in the following manner:

• Each partner is allocated interest equal to 5 percent of the beginning capital balance.

• Bernard is allocated compensation of $18,000 per year.

• Any remaining profits and losses are allocated on a 3:3:4 basis, respectively.

• Each partner is allowed to withdraw up to $5,000 cash per year.

Assuming that the net income is $60,000 and that each partner withdraws the maximum amount allowed, what is the balance in Collins capital account at the end of that year?

a. $70,800.

b. $86,700.

c. $73,500.

d. $81,700.