Articles of Partnership

question 52

Multiple Choice

Articles of partnership:

• A) are required to form a partnership by federal law.
• B) are a formal written agreement that states the partners' relationship.
• C) may be an oral agreement.
• D) Both B and C are correct.

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Definitions:

Inventory Valuation

The method used to calculate the cost associated with an inventory at the end of a financial period, affecting cost of goods sold and gross profit.

Gross Profit

The difference between sales and the cost of goods sold, indicating the basic profitability of a company's core business activities.

Ending Inventory

The value of goods available for sale at the end of the accounting period, calculated by adding purchases to beginning inventory and subtracting cost of goods sold.

Ethics Violation

An action that goes against moral principles or professional standards, often resulting in disciplinary action.