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You are provided with the following information about a business: a. The sales of the business has increased over the past financial year; b. The

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You are provided with the following information about a business: a. The sales of the business has increased over the past financial year; b. The gross profit of the business has decreased; The payment periods for both accounts receivable and accounts payable have increased; and d. The amount values of inventory and cash have declined. C. Asked: Consider the possibility of overtrading. Provide possible reasons for each of the above mentioned changes in the financial figures and conclude your answer by indicating whether it should be regarded as good or bad. ||

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