Withdrawl by proprietor
This query is : Resolved
10 July 2021
Suppose owner invest capital in business Rs 60000 .with this he has made huge profit of Rs 120000. In the same year we withdraw the amount of Rs 70000 which is more than the capital amount .what is accounting entry to be pass .
10 July 2021
Capital account dr 70000
To bank/cash cr 70000
To bank/cash cr 70000
10 July 2021
There is any problem if the negative capital will show in balance sheet .if has withdrawn more than his capital investment
10 July 2021
Add profit to his capital account, it will not be negative.
12 July 2021
Alternatively, withdrawals can be debited to drawings account I think.
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