Homework Answers
The owner's drawings account is closed by debiting the owner's capital account and crediting the owner's drawing account.
Owner's drawing account has normal debit balance. When owner's drawing account is closed, it is credited and due to owner's drawing, the balance in owner's capital reduces and thus owner's capital is debited.
All revenues and expenses are closed to income summary. Owner's drawing relates to owner, hence it is closed to owner's capital.
Second option is correct option.
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