I get this question from time to time so I figured I would address it here. I would through a percentage of cash flow. What percentage varies depending on the business. What I would do first, is determine the amount money you want/need to leave in the business to cover operating expenses and growth expenses. Then pay yourself out of the rest.
To record the payment to yourself you would cut a check out of the business and debit an owner – withdraw account on the balance sheet.
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