CA Foundation · Accounting · Theoretical Framework
In accounting terminology, amounts withdrawn by the proprietor from the business for personal use are called:
Such withdrawals are called drawings. They represent cash or goods taken out of the business by the proprietor for personal use, and they reduce the owner's capital rather than being charged as a business expense.
- ADrawingsCorrect
- BCapital
- CDiscount
- DBad debts
Explanation
Drawings are cash or goods taken by the owner for personal use. They reduce the proprietor's capital and are not an expense of the business. Capital is the owner's investment, so it is the opposite of withdrawals.
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