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Remedies for overtrading
Short-term solutions
• Speeding up collection from customers.
• Slowing down payment to suppliers.
• Maintaining lower inventory levels.
Long term solutions
• Increase the capital by equity or longterm debt.
Inventory turnover is the reciprocal of inventory days. (Cost of sales/Average inventory)x number of times This shows how quickly inventory is being sold. It illustrates the
list of those and their functions source of fund and how the sources are lend out?
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