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 anentry to:
A)Debit Salary Expense and credit Cash.
B)Debit Cash and credit Girard Don, Withdrawals.
C)Debit Girard Don, Withdrawals and credit Cash.
D)Debit Girard Don, Salary and credit Cash.
E)Debit Girard Don, Capital and credit Cash.

Question

Quizplus · Accepted Answer

When the owner uses cash from the business for personal use, it is considered a withdrawal. The entry to record this transaction would be to debit the owner's capital account (or specifically, the Withdrawals account) and credit the Cash account. Option B is incorrect because it only credits the Withdrawals account, not debits the Cash account. Option A is incorrect because it debits Salary Expense, which is not applicable in this situation. Option D is also incorrect as it debits Salary, which is not relevant to this transaction. Option E is incorrect because it credits the Capital account, which is not affected by a withdrawal.

If Girard Don, the Owner of Girard's Software Proprietorship, Uses