Drawings
Definition
Money or goods an owner takes out of a sole proprietorship or partnership for personal use. Drawings reduce the owner's capital and are not a business expense.
Related Terms in Core Accounting
Trial Balance Errors
Mistakes that a trial balance may or may not reveal. A trial balance catches errors that unbalance debits and credits, but not errors of omission, commission, principle or compensating errors, which leave it balanced yet wrong.
Bookkeeping vs Accounting
Bookkeeping is the systematic recording and organising of financial transactions; accounting builds on that record to classify, summarise, interpret and report. Bookkeeping is the data layer, accounting the analysis layer.
Single-Entry Bookkeeping
A simple method that records each transaction once, much like a cash book, without the matching debit and credit of double entry. It is easy but cannot produce a full balance sheet or catch many errors.
Narration
A short explanation attached to a journal entry describing what the transaction was for. Good narrations make the books auditable and help anyone reviewing the entry understand it later.
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