Question

Select the most appropriate alternative from the alternatives given below and rewrite the statement.

The amount brought in by the proprietor in the business should be credited to
a) Salary A/c
b) Mandar’s A/c
c) Cash A/c
d) Capital A/c

Answer 1

The amount brought in by the proprietor in the business should be credited to Capital A/c.

Explanation:
Any amount/value of goods withdrawn from a business is known as drawings and is deducted from the capital account of the proprietor. Likewise, any additional amount brought in by the proprietor is treated as capital and will be added to the existing capital of the business.