shiv and shankar were partners in a firm sharing profits in 3 : 2 ratio. their respective fixed capitals were rs. 170000 and rs. 210000. The partnership deed provided for the following :
1. interest on capital@ 12% p.a.
2. interest on drawings@18% p.a.
shiv withdrew rs.12000 on 30.6.2006 and shankar withdrew rs. 18000 on 30.9.2006. The profit of the firm for the year ended 31.3.2007 was rs. 97000, which was distributed among the partners without providing for the above adjustment.
pass necessary adjustment entry.

Shiv 's current a/c dr 6636
To Shankar's current a/c 6636

W.N. IOC is added 20400 to shiv and 25200 to Shankar ,
IOD taken 1620 from Shiv and 1620 from Shankar
Net rs 42360 added to partners in PSR = 25416 added to Shiv and 16944 to Shankar
final net amount =  Shiv  to be debited by 6636 and Shankar to be credited by 6636
(2) capitals are fixed so current a/c are debited and credited
(3) capitals are fixed so opening capitals are  same.

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