Question

difference between profit and loss account and profit and loss appropriation account ​

Answer 1

Answer:

P&L account is used to determine Net Profit or Net Loss of an organization for a given accounting period. P&L appropriation account is used for allocation and distribution of Net Profit among partners, reserves and dividends. P&L account is prepared by all types of businesses.

Answer 2

Answer!!

Difference between profit and loss account and profit and loss appropriation account:;-

→ Profit and Loss Account is prepared after Trading Account. Following the Profit and Loss Account, Profit and Loss Appropriation Account is prepared.

→ Profit and Loss Account commences with Gross Profit or Gross Loss. Profit and Loss Appropriation Account commences with Net Profit or Net Loss.

→ Profit and Loss Account is prepared to determine the net profit or net loss incurred during the accounting year. Profit and Loss Appropriation Account is prepared to show appropriation of net profit or net loss for the accounting period among the partners.

→ Preparation of Profit and Loss Account is not guided by the Partnership Deed. Preparation of Profit and Loss Appropriation Account is guided by the Partnership Deed.