Accounting 9706 · AS & A Level · Analysis and communication of accounting information

Analysis and communication of accounting information — practice question

In a comparison with the previous year, a trader discovers that his gross profit margin has risen while his trade receivables turnover has fallen. Which statement would account for this?

  • AHe bought in bulk and passed the savings on to his customers who bought more.
  • BHe offered more trade discount and more customers paid in cash.
  • CHe raised his selling price and offered more cash discounts.
  • DHe reduced his selling price to increase the total value of sales.

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