Farmer and Taylor formed a partnership with capital contributions of $205,000 and $255,000, respectively. Their partnership agreement calls for Farmer to receive a $72,000 per year salary. The remaining income or loss is to be divided equally. Assuming net loss for the current year is $16,000, the journal entry to allocate the net loss is:

• Debit Taylor, Capital, $44,000; Credit Income Summary, $16,000; Credit Farmer, Capital, $28,000.

• Debit Income Summary, $16,000; Debit Farmer, Capital, $28,000; Credit Taylor, Capital, $44,000.

• Debit Income Summary, $16,000; Credit Farmer, Capital, $8,000; Credit Taylor, Capital, $8,000.

• Debit Income Summary, $16,000; Credit Taylor, Capital, $8,000; Credit Farmer, Capital, $8,000.

• Debit Income Summary, $16,000; Debit Taylor, Capital, $28,000; Credit Farmer, Capital, $44,000.