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What is the accounting treatment for the rent received by the proprietor himself for using his own building for business purpose

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(Querist)
05 February 2015 What is the effect on capital for such rent received by him
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sailaja

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sailaja (Querist)
05 February 2015 Whether it should be considered as drawings. If yes, why?
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CA NAVEEN SINGLA

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CA NAVEEN SINGLA (Expert)
05 February 2015 First of all I would Explain That Drawings are always the Expenses for Partners/Proprietor.

Rent Recd. by Prop. from Prop. Firm is Income not Expenses.

Accounting treatment for Rent paid by Prop. Firm to Prop. is

Rent A/c Dr.
Proprietor Capital Cr.
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