Accounting Dictionary

Draw

A draw is the amount of money a partner or sole proprietor takes from his business before the final yearly profit is figured.

At the end of the year it was determined that John’s share of the partnership income was $80,000. During the year he had already received $63,000. The $63,000 was his draw. The $63,000 was the amount he drew out of the company to be subtracted from the total amount to which he is entitled.

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