Owner's capital will be reduced by the amount in the drawing account.

Name: Owner's capital will be reduced by the amount in the drawing account.
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Question

Quizplus · Accepted Answer

When an owner withdraws money from their business, it is recorded in the drawing account. This decreases the company's assets and also decreases the owner's equity since it is their own personal withdrawal of funds. Therefore, owner's capital will be reduced by the amount in the drawing account.

Owner's Capital Will Be Reduced by the Amount in the Drawing