When a partner makes a drawing of stock items from a partnership, the accounting impact of the drawing is to increase the partner's?
Question 1 Report
When a partner makes a drawing of stock items from a partnership, the accounting impact of the drawing is to increase the partner's?
Answer Details
When a partner makes a drawing of stock items from a partnership, the accounting impact of the drawing is to increase the partner's current account debit balance. This is because drawings are considered as withdrawals made by the partner for their personal use and thus reduce the amount of capital that the partner has in the business. The current account is used to track each partner's share of the profits or losses of the partnership, as well as their drawings and other transactions. When a partner takes a drawing, it increases their debit balance in the current account because they owe more money to the partnership.
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