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Hi.
I would like to know in what cases I can be sure that overtrading exists?
Thanks.You can never be sure in the exam – you can only point to factors that suggest overtrading.
The main factors are that the company has been expanding rapidly, they have a cash flow problem and a shortage of working capital.
Please,help me to understand the following
there is an example “ewden” at the end of the chapetr 5, i am looking at the solution there are the main factors of overtrading but is concluded that overtrading is absent.
thanks.You ask about an example “Ewden” at the end of Chapter 5.
But Chapter 5 of which book????
Paper F5 Performance Management,the title of the chapter is “working capital management.introduction”
I am sorry but I have no idea whose book you are referring to!
(Also, working capital management is Paper F9, not F5)Sorry for misunderstanding.I use the translated version of ACCA papers and maybe there are some inconsistence.
I will try to check and write you the correct reference.Hi
I think that I have found the original ACCA paper.Pleas,if it is possible look through Paper 2.4,chapter 5 working capital.introduction,page 79,”Ewden” Plc.I would like to repeat my question.
i am looking at the solution of that example there are the main factors of overtrading but is concluded that overtrading is absent.
ThanksI would love to help you, but you still do not say which book you are looking at. Is it BPP or Kaplan or who??
However I do not have any 2.4 books any more so it doesn’t matter which.
I don’t know which paper you are sitting this time, working capital management is examinable now in Paper F9 (not Paper F5).
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