A. Increase in capital
B. Remain the same
C. Decrease in capital
D. No effect on capital
Related Mcqs:
- Which of the following accounts will be debited if the business’s owner withdraws cash from business for his personal use?
A. Drawings
B. Cash
C. Business
D. Stock - _______ the withdrawal of cash and goods by the owner of the busienss for his/her personal use?
A. Depreciation
B. Drawings
C. Outflow of cash
D. Appreciation - Introduction capital by owner of business is recorded on which side of a cash book?
A. Receipts
B. Payments
C. Incomes
D. Expenditures - A discount of $2000 was given to a supplier on his prompt repayment of debt but the cashier entered the gross amount in cash book. What should be the adjustment in cash to work out the correct balance of cash book?
A. $2000 will be debited in cash book
B. $2000 will be credited in cash book
C. $4000 will be debited in cash book
D. $4000 will be credited in the cash book - Cash brought by the owner to start business is called__________?
A. Capital
B. Loan
C. Drawing
D. None of these - When owner withdraw cash for its private use, it is called ___________?
A. Profit
B. Income
C. Expense
D. Drawing - Drawings by owner of business are generally recorded on which of the following side of a cash book?
A. Receipts
B. Payments
C. Incomes
D. Expenditures - Bank charges amounting to $5000 was not entered in the cash book. Identify the correct adjustment in cash book?
A. Bank charges will be debited in cash book
B. Bank charges will be added to cash book balance
C. Bank charges will be credited in cash book
D. Bank charges need no adjustment in cash book - Bank sent debit advice of $500 to company being interest on overdraft. It wasn’t entered in cash book. Identify the correct adjustment in cash book.
A. $500 will be debited
B. $500 will be credited
C. Non-adjustable
D. $1000 will be subtracted - A company was entered in hire purchase agreement and had to pay $1000 per month. Three payments were made via bank account but no entry was found in cash book. Identify the correct adjustment in cash book
A. $1000 will be added to cash book balance
B. $2000 will be deducted from cash book balance
C. $3000 will be added to cash book balance
D. $3000 will be subtracted from cash book balance
The correct answer to the question: "If the business’s owner withdraws cash for his/her personal use what will be the effect on capital?" is "Decrease in capital".
