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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FM Exams › Overtrading
Hi sir, let’s say for example a company is overtrading , the inventory holding could either increase or decrease right ?
If it increases: Could be because the firm is overbuying or intentionally building up inventory in anticipation of futher sales growth.
If it decreases: Means the inventory is selling fast. This could be as a result of poor planning by the management team.
Am i right to say this ?
What you have written is fine 🙂
Thank you sir.
You are welcome 🙂