Profit and loss appropriation account is prepared by the partnership firm to find out:

Net profit Super profit Divisible profit Trading profit

Divisible profit

The Profit and Losses of the partnership are divisible equally or in any other manner agreed upon by the partners. In case of partnership accounting, it is usual that adjustments relating to Interest on Capital Interest on Drawings, Salary, Commission, share of profits etc. to be made through the Profit and Loss Appropriation Account.