If the owners of a business withdraw goods from the business for their own personal use it should be recorded as:
A) A sale
B) An expense of the business
C) A decrease in the owners' equity
D) A reduction in inventory and a decrease in the owners' equity

Question

Quizplus · Accepted Answer

When the owners withdraw goods from the business for personal use, it should be recorded as a reduction in inventory (as the goods are no longer available for sale) and a decrease in the owners' equity (as they have essentially taken money out of the business). It is not a sale, as the business did not receive any money for the goods, and it is not an expense of the business, as the goods were not used for business purposes.

If the Owners of a Business Withdraw Goods from the Business