If trade receivables is reduced,the amount of capital employed is reduced and profitability is increased

Name: If trade receivables is reduced,the amount of capital employed is reduced and profitability is increased
Brand: Quizplus
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Question

Quizplus · Accepted Answer

Reducing trade receivables means there is less money tied up in the business, which lowers the capital employed. This can increase profitability because there is more money available to invest in other areas of the business or to pay dividends to shareholders.

If Trade Receivables Is Reduced,the Amount of Capital Employed Is