There are two ways to withdraw amount from business:
1. Deduction from capital account
You can create following journal entry:
Debit: Drawings
Credit: Cash/Bank
(Being cash withdrawn by proprietor)
Open drawings account under Capital A/c. Drawings account is to be shown as a deduction from Capital Account in the Balance Sheet.
2. Treat drawings as indirect expense
You can create following Expense entry:
Debit: Drawings
Credit: Cash/Bank
Open drawings account under Indirect Expenses. After saving this transaction, Net Profit gets reduced accordingly.
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