If Girard Don,the owner of Girard's Software proprietorship,uses cash of the business to purchase a personal computer,the business should record this use of cash with an entry to:
A) Debit Salary Expense and credit Cash.
B) Debit Girard Don,Salary and credit Cash.
C) Debit Cash and credit Girard Don,Withdrawals.
D) Debit Girard Don,Capital and credit Cash.
E) Debit Girard Don,Withdrawals and credit Cash.

Question

Quizplus · Accepted Answer

When the owner of a business uses business cash for personal use, it is considered a withdrawal. Therefore, the entry to record this transaction should be a debit to "Girard Don, Withdrawals" and a credit to "Cash." Option E is the correct choice. Options A, B, and D are incorrect as they do not reflect the proper accounting treatment for withdrawals. Option C is incorrect as it implies that the transaction is a salary expense, which is not the case.

If Girard Don,the Owner of Girard's Software Proprietorship,uses Cash of the Business