The journal entry for goods withdrawn by the proprietor for personal use is: MCQ with Answer and Explanation

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The journal entry for goods withdrawn by the proprietor for personal use is:

A. Drawings A/c Dr. To Sales A/c

B. Purchases A/c Dr. To Drawings A/c

C. Capital A/c Dr. To Purchases A/c

D. Drawings A/c Dr. To Purchases A/c

Answer: Option D

Solution (By JKSSB Mock Tests)

Goods taken for personal use reduce drawings and reduce purchases (or stock). Correct entry: Drawings A/c Dr. To Purchases A/c.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

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Question #1

The 'Tolerable Error' in audit sampling is:

A. Expected error

B. The maximum error in the population that the auditor is willing to accept and still conclude that the audit objective is achieved

C. Actual error

D. Zero error

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Correct Answer: Option B

Explanation:
Tolerable error is a planned level of misstatement.

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Question #2

A 'Contra Entry' in the cash book involves:

A. Cash and bank columns only

B. Cash and discount columns

C. Only bank column

D. Bank and discount columns

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Correct Answer: Option A

Explanation:
Contra entries affect both cash and bank columns (e.g., cash deposited, cash withdrawn).

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Question #3

If debt-equity ratio is 2:1 and total assets ₹12,00,000, long-term debt is: (Assume no current liabilities)

A. ₹8,00,000

B. ₹4,00,000

C. ₹6,00,000

D. ₹2,00,000

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Correct Answer: Option A

Explanation:
Total assets = Equity + Debt (since no CL). D/E = 2, so D=2E. E + 2E = 12L => 3E=12 => E=4L, D=8L.

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