Introduction to Accounting — Account STD 11 Commerce — Question
CBSE BoardEnglish MediumSTD 11 CommerceAccountIntroduction to Accounting1 Mark
MCQ
Drawings account is to be created by linking with:
✓
Capital
B
Current asset
C
Current liability
D
Drawings
✓
Answer
Correct option: A.
Capital
The drawings account is to be created by linking with Capital. Drawing means the amount withdrawn by the owner.
When the owner withdraws some amount from the business it is known as the drawings.
As per Business Entity Concept, the businessman is considered separate from the business.
Therefore, capital is the liability for the business and investment for the owner.
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