Maharashtra State BoardHSC Arts 12th Board Exam
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Answer in One Sentence Only. - Book Keeping and Accountancy

One Line Answer

Answer in one sentence only.
What does the excess of debits over credits in profit and loss adjustment account indicate?

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The excess of debits over credits in Profit and Loss Adjustment Account indicates the amount of net loss that needs to be shared by the old partners in their old profit sharing ratio. This is done as the new partner is not liable for any losses due to the past activities of the old partners.

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Micheal Vaz Accounts - Book Keeping and Accountancy HSC 12th Standard Maharashtra State Board
Chapter 3 Reconstitution of Partnership (Admission of Partner)
Exercise | Q 4 | Page 107
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