BUSINESS ADMINISTRATION
FINANCIAL ACCOUNTING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Drawings A/c
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Capital A/c
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Cash A/c
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None of these
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Detailed explanation-1: -Withdrawal of cash by proprietor should be debited to drawing account in the books of the business. Same amount should be credited by the proprietor in cash account. Was this answer helpful?
Detailed explanation-2: -When a business owner withdraws cash for personal use, these funds come out this capital account. Proprietor withdrawal cash or other asset from business recorded as credit to cash and a debit to the proprietor draws account i.e. cash in hand to decrease.
Detailed explanation-3: -The amount which the owner withdraw from business for personal use is called as drawings. It is shown as deduction from the amount of capital in the balance sheet.
Detailed explanation-4: -Cash is withdrawn for personal use, therefore drawings account should be debited.