The owner's personal withdrawals for the year cause a decrease in net income.

Name: The owner's personal withdrawals for the year cause a decrease in net income.
Brand: Quizplus
Rating: 4.7 (34 reviews)

Question

Quizplus · Accepted Answer

Owner's personal withdrawals, often referred to as drawings, do not affect the net income of a business. Net income is calculated based on the company's revenues and expenses, and drawings are recorded separately as a reduction in the owner's equity, not as an expense.

The Owner's Personal Withdrawals for the Year Cause a Decrease