A withdrawal of cash for personal use by an owner would:
A)decrease total assets and decrease owner's equity.
B)increase owner's equity and increase liabilities.
C)decrease total assets and increase owner's equity.
D)increase total assets and decrease owner's equity.

Question

Quizplus · Accepted Answer

A withdrawal of cash for personal use by an owner decreases total assets (because cash is an asset that is reduced) and decreases owner's equity (because the withdrawal is essentially the owner taking out part of their claim or investment in the business).

A Withdrawal of Cash for Personal Use by an Owner