As discussed under 2 Nephi 3:18, there are a few cases in the text where it is not obvious whether also should end the preceding sentence or begin the following sentence. The question here in Alma 42:15–16 is whether also should be at the end of verse 15 (“that God might be a perfect just God and a merciful God also”) or at the beginning of verse 16 (“also now repentance could not come unto men except there were a punishment”). The two manuscripts did not have any original punctuation here, so we cannot tell from the original hands in the manuscripts where the break came in Alma 42:15–16. The 1830 compositor, as he was marking with pencil the punctuation in 𝓟, placed a period before the also. He also set the 1830 edition this way (including capitalizing the a of also, of course). But in the 1837 edition, the also was shifted to the end of verse 15, after God (and correspondingly, the n of the now was capitalized).
This correction is probably right because there are no sentences elsewhere in the text that begin with “also now”. And there are at least two examples of also coming at the end of a conjoined phrase at the end of a sentence:
Summary: Accept the 1837 decision to shift the also from the beginning of verse 16 to the end of verse 15 (“that God might be a perfect just God and a merciful God also”).