Which of the following entries records the investment of cash by Ron York, owner of a proprietorship?
A) debit Ron York, Capital; credit Accounts Receivable
B) debit Cash; credit Ron York, Capital
C) debit Ron York, Drawing; credit Cash
D) debit Cash; credit Ron York, Drawing

Question

Quizplus · Accepted Answer

This entry records the investment of cash by the owner of the proprietorship (Ron York) into the business, and thus it debits Cash and credits Ron York's Capital account to reflect the increase in owner's equity. Option A records a transaction involving Accounts Receivable, which is not relevant here. Option C records a withdrawal by the owner, which is not applicable to this transaction. Option D again records a withdrawal, which is not relevant here.

Which of the Following Entries Records the Investment of Cash