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Journal entry

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CHAITRI SUDHAKARBHAI KHAROD

ARTICLE

533 Points Posted on 06 April 2020

If Mr A withdraws goods of rs 1500 from his business which is not recorded in BOA....

now , it will be recorded as..

(1) withdrawal a/c Dr 1500
to goods on withdrawal 1500

(2) A's capital a/ c Dr 1500
to withdrawal a/c 1500

is this correct? If yes...

then what's about cash entry??

Replies (3)

Quick Summary

This discussion clarifies the correct journal entry when a proprietor, Mr A, withdraws goods worth Rs 1500 from his business without it being initially recorded. The agreed-upon entry debits Mr A's Capital or Current Account and credits the Purchases Account, as no cash transaction has occurred. This method accurately reflects the reduction in business stock and the proprietor's equity.

Tarun Kansal

32 Points Posted on 06 April 2020

Correct entry is
Mr A capital A/c. Dr. 1500/-
To Purchases A/c. 1500/-
As no cash is involved here that's why no treatment for cash

RAJA P M

"Do the Right Thing...!!!"

77833 Points Posted on 06 April 2020

Yes... I agreed to Mr Tarun Kansal.,

@ Mr CHAITRI SUDHAKARBHAI.,

If You are maintained separately Withdrawal Account (Current Account) then You provide entry to Current Account only as above :

Mr A's Current (capital) A/c. Dr. 1500/-
To Purchases A/c. 1500/-

In case Only maintained Capital Account then provide entry as above :

Mr A's Capital A/c. Dr. 1500/-
To Purchases A/c. 1500/-