Adjusting entries

elecho12 · #1 Feb 4, 2007, 01:52 PM

What is the entry for An owner that withdrew cash for personal use from the Business.
Say his name is raymond This is what I entered

Dr: Raymond
Cr: Cash

is this correct?

Do I have to enter it in the capital account and as what a debit or credit

CaptainForest · Feb 4, 2007, 07:15 PM

The JE would be:
Dr. Raymond, Drawing XXX
Cr. Cash XXX

The Raymond, Drawing account is an account that offsets the Raymond, Capital account.

So at the end of the year, when it comes time to close the Drawing account, you would:
Dr. Raymond, Capital XXX
Cr. Raymond, Drawing XXX



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