Drawings are shown as _______ in the vertical form of the balance sheet.

addition to current assets

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deduction from current liabilities

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addition to equity/capital

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deduction from equity/ capital

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Solution

The correct option is D
deduction from equity/ capital

Drawings are shown as a deduction from equity/ capital in the vertical form of the balance sheet.

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Similar questions

Q. Calculate Current Ratio, Quick Ratio and Debt to Equity Ratio from the figures given below:


Particulars		₹
Inventory		30,000
Prepaid Expenses		2,000
Other Current Assets		50,000
Current Liabilities		40,000
12% Debentures		30,000
Accumulated Profits		10,000
Equity Share Capital		1,00,000
Non-current Investments		15,000

Calculate (i) Debt-Equity Ratio; (ii) Total Assets to Debt Ratio; and (iii) Proprietary Ratio from the following particulars :

$\begin{matrix} Particulars & Rs. Equity Share Capital & 3, 00, 000 Preference Share Capital & 1, 00, 000 General Reserve & 60, 000 Profit & Loss Balance & 40, 000 12 % Mortgage Loan & 1, 80, 000 Current Liabilities & 1, 20, 000 Non Current Assets & 4, 50, 000 Current Assets & 3, 50, 000 \end{matrix}$

What conclusions do you draw from the above ratios ?

Q. ________ contributes asset in a form of capital or equity.

Following is the Balance Sheet of Raj Oil Mills Limited as at March 31, 2017. Calculate Current Ratio.

Particulars	(Rs)
I. Equity and Liabilities:
1. Shareholders’ funds
a) Share capital	7,90,000
b) Reserves and surplus	35,000
2. Current Liabilities
a) Trade Payables	72,000
Total	8,97,000
II. Assets
1. Non-current Assets
a) Fixed assets
Tangible assets	7,53,000
2. Current Assets
a) Inventories	55,800
b) Trade Receivables	28,800
c) Cash and cash equivalents	59,400
Total	8,97,000

Q. Current liabilities are Rs.10,000 and current assets are Rs. 15,000. If debtors realized Rs.3,000 and Rs.6,000 worth preference shares got converted into equity, the impact on working capital (WC) would be _______________.

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Drawings are shown as _______ in the vertical form of the balance sheet.

The correct option is D deduction from equity/ capital Drawings are shown as a deduction from equity/ capital in the vertical form of the balance sheet.

The correct option is D
deduction from equity/ capital

Drawings are shown as a deduction from equity/ capital in the vertical form of the balance sheet.