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January 11, 2023 at 2:56 pm
Hope your in good health and spirits. Question on last entry of drawings. Is this treated in same manner as dividends? I.e it is part of owners equity which essentially increases with credit but as it reduces equity it is seen as a contra asset account hence increased with debit? Also in equations it is in credit side but with a negative, increase in net assets=capital+profit-drawings.
Thanks in advance
December 24, 2022 at 11:20 am
Really indebted to you, professor!
October 16, 2022 at 5:44 pm
sir you credited sales it that means sales is decreased and when income decreased must be credited? but hows that fits the three rules of credit thanks
November 13, 2022 at 4:40 am
Sales is an income account. When you credit income, you increase it.
September 27, 2023 at 8:41 pm
I think you credit income because sales/profit belongs to the owner or shareholders of the business so is now capital (owed to the owners) essentially a liability from the businesses perspective. And back to the entry credit rule ‘an increase in a liability’ which is the profit.
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