Cari's Bakery, Inc. began operations in October 2019. The owner contributed cash of $12,000 and a delivery truck with fair value of $16,000 to the company. Which of the following describes how these transactions would affect the company's equity account? Explain.

a. Increase earned capital by $12,000 and contributed capital by $16,000

b. Increase contributed capital by $12,000 and earned capital by $16,000

c. Increase earned capital by $28,000

d. Increase contributed capital by $28,000