Journal Entry

Goods withdrawal for personal use.

can i use this journal Entry .Is it wrong?

Capital a/c........Dr
To Drowings
Replies (3)
Quick Summary
This discussion clarifies the correct accounting treatment for goods withdrawn by an owner for personal use. It explains that the standard entry involves debiting the Drawings Account and crediting the Goods Account (or Purchases Account). The conversation also touches upon the transfer of drawings to the Capital Account and the effect on the Trading Account when goods purchased for business are used personally.

Goods  withdraw  for  personal  use . 

1)     Drawings                   A/c       Dr 

        To Goods                  A/c        Dr 

( Being  Goods  withdraw  for  personal  use )  

 

Transfer  to Capital   Account 

 Capital                            A/c        Dr 

 To Drawings                   A/c         Cr 

(  Drawing  transferred  to capital  account  )   

so  your  above  entry  is transfer entry  . 

But in some cases I have seen,
Drowings a/c......Dr
To Purchase

please clarify the effect in trading a/c

Goods  purchase  for  Business  purpose use for personal  purpose  so  here Goods  and purchase are one  and same  , drawings  will  be  reduce  form  purchase A/c  .  purchase A/c  with  reduce  balance  will be  reflected  in Trading  A/c . 

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