Please let me know the difference between P & L adjustment account and P & L appropriation account.
Thanks.
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P & L Appropriation A/c is prepared at the time of finalisation of accounts to show appropriation (Distribution) of profits.
P & L Adjustment A/c is prepared after finalisation of accounts to rectify any error in the accounts or to give retrospective effects for some adjustments.
Eg.: For valuation of goodwill some adjustments are made in final accounts i.e. to record expenses.
P & L Appropriation A/c is prepared at the time of finalisation of accounts to show appropriation (Distribution) of profits.
P & L Adjustment A/c is prepared after finalisation of accounts to rectify any error in the accounts or to give retrospective effects for some adjustments.
Eg.: For valuation of goodwill some adjustments are made in final accounts i.e. to record expenses.