When we do drawings of goods for personal use so entry is recorded as debit Drawings and Credit Purchases.
Why not Credit Inventory?
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Accounting Treatment
4y ago#1Because we only make entries in the inventory account at the end of the period and we enter what is actually counted in inventory. The owner will have already taken the goods before the count at the end of the period.
Everything bought during the period is debited to purchases. If the owner takes any of them then they are no longer available for the company and we therefore credit purchases.
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