Overtrading!!!

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February 8, 2017 at 2:13 pm #371617
vuvietquang90
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Dear tutor,

Can u explain for me this sentence
“Overtrading is also known as under-capitalisation”

Thank you in advance
February 8, 2017 at 4:01 pm #371660
John Moffat
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It is under-capitalisation because they have not raised enough long-term capital needed to finance the increased working capital.

This is all explained in full in my lectures on over-trading, and I am not going to type out all of my lectures here 🙂
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