The owner's drawings account

Question

Quizplus · Accepted Answer

The owner's drawings account is a contra equity account that is used to track the withdrawals made by the owner from the business. When the owner withdraws cash, the drawings account is debited and the cash account is credited to reflect the reduction in the owner's equity. Therefore, the correct answer is C. A is incorrect because the owner's drawings account is not reported on the income statement. B is incorrect because the owner's drawings account is not credited when the owner withdraws cash. D is incorrect because the owner's drawings account is a proper subdivision of owner's equity.

The Owner's Drawings Account