Basic accounting terms | capital | drawing| interest on capital| interest on drawing

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Basic accounting terms | capital | drawing| interest on capital| interest on drawing

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Commerce Shruti

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Basic accounting terms | capital | drawing| interest on capital| interest on drawing

Welcome to Commerce Shruti! In this video, we will dive into the concepts of Capital and Drawings, two fundamental terms in accounting that are crucial for understanding the financial activities of a business.

We’ll cover:

Capital: The amount of money or assets invested by the owner(s) in the business. It represents the owner's stake in the business and is recorded as a liability because the business owes this to the owner.
Examples include cash investments, property, or equipment contributed by the owner.
How capital increases through profits and additional investments.
Drawings: The withdrawal of cash or goods by the owner for personal use. It reduces the owner’s equity in the business and is deducted from the capital account in the balance sheet.
The impact of capital and drawings on the accounting equation and financial statements.
By the end of this video, you will clearly understand how capital and drawings reflect the owner’s role in the financial health of a business. Ideal for Class 11 students and beginners in accounting!

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#BasicsOfAccounting
#AccountingConcepts
#CommerceShruti
#FinancialStatements
#LearnAccounting

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Views : 14
Genre: Education
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Uploaded At Jan 1, 2025 ^^

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RYD date created : 2025-01-03T09:44:43.712806Z
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Accounting basics