Li Chen has calculated profitability ratios using data extracted from his client's pre-audit trial balance. He also has the values for the same ratios for the preceding two years (using audited figures). The data for the gross profit and profit margins are shown below. Li is a little confused because the profit margin shows declining profitability, but the gross profit margin has improved in the current year and is higher in 2023 than in the previous two years. Which of the following are possible explanations for the pattern observed in the gross profit and profit margins? (Several choices may be correct.) Misclassification of cost of goods sold as operating expenses Misclassification of operating expenses as cost of goods sold Overstated purchase costs Understated closing inventory Increased advertising costs Overstated sales in the current period Increase in sales with a larger increase in selling and administrative expenses