Owners draw is an equity account. Suggested procedure is to have 3 working equity accounts per owner.
1. Owner Draw (money taken out)
2. Owner Contributions (money added)
3. Owner Equity (total of current equity aside from draw and contribution)
And these three equity accounts should be equal sub-accounts of a "master", summing Equity account that is not posted to but is a sum of the child accounts. Reasoning is this: You can track annual additions and subtractions through accounts 1 and 2 above and on day one of each new year you "move" or roll up the balances from these 2 into the third equity account. This gives you the ability to run a report on 12/31 to compare money in and money out. You can do it with a single equity account and simply add and subtract but this gives you a clearer picture of activity.
To create a draw you can record a check or an Expense, depending on how you remove company funds and place in the hands of the owner(s). In the detail of the check/expense will be the Draw account
To create the equity accounts you can start from your Chart of Accounts (left hand banner under Accounting) and select New (the green button upper right)
