Which of the following statements is correct with regard to drawing accounts that may be used by a partnership? Group of answer choices A. Drawing accounts establish the amount that may be taken from partnership by a partner in a given time period B. Drawing accounts are closed to the partners’ capital accounts at the end of the accounting period C. Drawing accounts appear on the balance sheet as a contra-equity account D. Drawing accounts are similar to Retained Earnings in a corporation.
Which of the following statements is correct with regard to drawing accounts that may be used by a partnership? Group of answer choices A. Drawing accounts establish the amount that may be taken from partnership by a partner in a given time period B. Drawing accounts are closed to the partners’ capital accounts at the end of the accounting period C. Drawing accounts appear on the balance sheet as a contra-equity account D. Drawing accounts are similar to Retained Earnings in a corporation.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Which of the following statements is correct with regard to drawing accounts that may be used by a partnership?
Group of answer choices
A. Drawing accounts establish the amount that may be taken from partnership by a partner in a given time period
B. Drawing accounts are closed to the partners’ capital accounts at the end of the accounting period
C. Drawing accounts appear on the balance sheet as a contra-equity account
D. Drawing accounts are similar to Retained Earnings in a corporation.
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