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CSS Financial and Cost Accounting P-1 QUESTION #1198
Question 1
Which financial statement in a sole proprietorship reflects the owner's withdrawals for personal use?
  • Income Statement
  • Statement of Financial Position
  • Statement of Cash Flows
  • Statement of Owner's Equity✔️
Correct Answer Explanation
The Statement of Owner's Equity (also called the Capital Statement) shows changes in the owner's capital account during the period. It reflects the opening capital, plus net income, minus owner's drawings (personal withdrawals). Drawings reduce the owner's equity and are not shown in the Income Statement.