Profit and loss appropriation account:

(a) this account appears below the profit and loss account in the final accounts and begins with the net profit brought down from that account - this is the total amount which is available for distribution;

(b) the debit side shows the split of the profit according to the partnership agreement: it is important to note that such features as salaries and interest on capital should be given before the share of profits is calculated, as they reduce the amount of net profit available for splitting according to the profit-sharing ratio. LO.1