Question: Perols Ltd recently produced draft financial statements for the most recent year. Soon after the statements were prepared, it was discovered that a trade payable

Perols Ltd recently produced draft financial statements for the most recent year. Soon after the statements were prepared, it was discovered that a trade payable had been misclassified on the statement of financial position as a long-term loan.A colleague has suggested that the effect of correcting this error would mean that:1. Sales to capital employed ratio will decrease.2. Average settlement period for trade payables will increase.Are the above statements true or false?Statement 1 Statement 2A. False FalseB. False TrueC. True FalseD. True True

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