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One basic weakness of the simplified pro forma approaches lies in the assumption that the firm's past financial condition is an accurate indicator of its future.
Agreement in Principle
An initial acceptance indicating a preliminary agreement before the details are finalized.
Binding Contract
An agreement between two or more parties that is legally enforceable in a court of law.
Verbal
Pertaining to words or spoken communication, often used in the context of agreements or contracts.
Written Contract
A formal agreement between two or more parties that is fully documented and signed, outlining specific obligations and terms.
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