yo what up cph strength strongest cpa in
the state of Florida back at it again
with basic accounting for beginners
number 18
look at that s 18 right there let's get
it in this is a fucking highly requested
video I really appreciate all the
questions all the comments because you
know i think my last three or four basic
accounting videos have been questions
that I get and comments i read all them
so anyways thank you very much
let's do this this is number 18
what is a draw well you know me i need
to fucking pn in its not smoke or don't
know your opinion
I need something my hiding some my hands
everything
what is a draw now I've got this so many
times
Mike my clients have a hard time
figuring out where it is i had a hard
time figuring out where it is
I'm sorry took me to 18 to talk about
where is it's just there's a lot of
stuff so here now and I figured we would
start off with the definition in the
accounting book this is probably you
know what you're seen as you're taking
the beginning accounting class so i'll
put it up right here
what i'm reading from the book owner's
equity is the owners right to the assets
of the business after all liabilities
have been paid
okay so it's okay for proprietorship the
owner's equity is represented by the
balance of the owners capital account
ok so we're dealing basically we're
dealing with equity right now but I'm
doing that because the next sentence is
a drawing account represents
the amount of withdrawals made by the
owner
ok and i wrote that right up here so so
this is from this is from the book a
drawing account represents the amount of
withdrawals made by the owner even in
their thing given in the book definition
a drawing is the amount of withdrawals
made by the owner so that's another so
basically you see it's raw synonymous
with the withdraw and it's by the owners
it's lessening the owner i always get
questions on what to draw because that's
one of you know the components of dca
blur and it's a good question what is it
raw you know I get this all the time all
the time
what is the draw is a positive positive
definite side or Eric goes up on the
debit side that strong now I was writing
down this one is a draw the damn again
boys again jack son
so what is wrong i think it's synonymous
with a withdraw they even say in the
book so it must be right
what I use it a lot now this is an
s-corp if you had an s corp and the
owner takes out money out of the
business
it's a shareholder distribution so
that's an S court and this is what most
of my clients are this is what my
businesses as well as an escort i really
like it because of the shoulder
distributions dividend would also mean
the distribution is the D here this can
also be a district
Lucien and ok so called free
distribution also a dividend is also
withdraw it would go here but that would
be for a c-corp so that's also that but
it's a dividend that also goes here
there's a lot of things that go in the
the derailleur draw distribution
different a lot of deeds and I think
probably the one of these are ways you
know think of a draw and the books is
drawing which I don't like is in my
fucked-up I don't think you know a mom
like draw a little picture something
will stick that's for another video
about abbreviations and cut but I think
if you're beginning and you don't really
have this concept down pat yet if you
see like stop writing down draw i know
it's adi but maybe you think if you
start writing with with draw and then
just like circle the draw because
anything going to withdraw and most
people know you know like you go to the
bank and you're withdrawing money so
your business's bank account in you
withdraw money so you're taking your
taking money out of the business you can
take other stuff of your equity but
you're basically you're taking out of
your business is it withdraw was the
different kinds of I guess synonyms or
I'm going to but so there's like the
synonyms of water draw is now we're
gonna get some more like this is
actually the the crops of here
what is a draw it reduces equity it
reduces equity
and if you see in the DC learn you know
this is the this is the income statement
this is the balance sheet here is the
equity in the drop the drawbar
distribution are given a withdraw it
reduces the equity that's what does it
reduces the equity drawing account
represents the amount of withdrawals
made by the owner as you can see if you
use your DC a blur that it changes the
balance sheet mean our balance sheet is
assets equals liabilities plus equity
for the accounting equation we said that
the draw count reduces equity well if
you have a change in equity that's part
of the balance sheet means you're going
to have a change in the balance sheet
alright it it does not it does not
change the income statement income
statement as revenues minus expenses and
the draw has no bearing in that blessing
to one of my clients this is how he
understands a shoulder distribution or
drawer it's it's a personal expense not
a business expense
let's see my god we want we want soul so
long
please explain what a dry as or withdraw
or explain it a little bit we're going
to do an example i was thinking about
possibly to an example this video but
going too long so i wanted so look for
another video like if this helped you
out share comment
do your thing and it's like this that
she was going to come up here and take
off that i put 50 rounding like a
baseball draft deuces