Week 5 Written Assignment should Case Middlehurst House

Middlehurst House is a daycare center/preschool which operates as a partnership of George Friedman and Bill Compton. The center is in a city that has a large base of twoincome families who have a need for quality day care. The two men started the center this year. Compton contributed 40,000 to get the business started-to purchase equipment and to operate through the early months. Friedman, who previously managed another center, is the director of the center and draws 2,000 per month for his services. Partnership profits and losses, after Friedman's salary, are split 75 percent for Compton and 25 percent for Friedman.

Middlehurst House operates from 6 a.m. to 6 p.m., Monday through Friday. It is in a single building that has a...