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Melissa and Claudia Are Considering Becoming Business Partners and Establishing

question 85

Essay

Melissa and Claudia are considering becoming business partners and establishing a clothing boutique.They agree that they need to have a partnership agreement before they start the business.What factors should Melissa and Claudia consider when writing their partnership agreement?


Definitions:

Adjustment

A modification made to financial records to correct or update them.

Balance Sheet Approach

A method of estimating the net worth of a company by comparing its assets against its liabilities and shareholders' equity.

Receivables

Amounts owed to a company by its customers from sales or services provided on credit.

Bad Debts

Accounts receivable that a company has determined are uncollectible, leading to their recognition as a loss.

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