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How does delaying payments to suppliers reduce capital employed?
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is it the current ratio ?
Delaying payments to suppliers can reduce capital employed(CE) because it increases the accounts payable on the balance sheet, which is a current liability. Since capital employed is calculated as total assets minus current liabilities, an increase in accounts payable (due to delayed payments) will result in a decrease in CE
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total assets minus current liabilities.. that was silly , sry .. thanks
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