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WAEC - Commerce (2021 - No. 9)

One of the disadvantages of selling on credit is
reduction in turnover
reduction in profit
increase in liquidity
bad debts

Explicaţie

When selling on credit, there is always a very high possibility that some of your creditors will not pay up as at when due or may fail to pay at all. These unpaid credits are considered bad debts in business. Hence it is one of the disadvantages of credit sales as the seller is unlikely to recover all their debts.

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