The withdrawals account of each partner is:
A) Closed to that partner's capital account with a credit.
B) Closed to that partner's capital account with a debit.
C) A permanent account that is not closed.
D) Credited with that partner's share of net income.
E) Debited with that partner's share of net loss.

Question

Quizplus · Accepted Answer

The withdrawals account is a temporary account that keeps track of the amount that each partner withdraws from the partnership for personal use. At the end of the accounting period, the balance of the withdrawals account is closed to each partner's capital account with a credit, reducing their equity in the partnership. Therefore, choice A is the correct answer. Choices B, C, D, and E are not applicable to the withdrawals account.

The Withdrawals Account of Each Partner Is