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Drawings

taha123 (ca) (75 Points)

26 November 2015

what is drawings against profit and against capital what is its accounting treatment

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Madhur Asati (25 Points)
Replied 26 November 2015

Drawing against profit means withdrawing from profit earned and hence no interest on capital shall be there and Drawing against capital means withdrawing from capital and hence interest on capital shall be charged.Hence basically on Drawing against profit no interest on capital shall be charged and in Drawing against Capital interest on capital shall be charged.