The following information comes from the accounting records of Hercep Ltd. for the first three years of its existence:
In each of the three years, Hercep paid 10% interest on its long-term debt, and the current liabilities were non-interest bearing. In addition, the company made half of its first year's sales on credit, and made one-third of the second and third years' sales on credit. Hercep's shares sold for $12.75, $10.00, and $12.75 at the end of the years 2009, 2010, and 2011, respectively. The company also declared and paid dividends of $40,000, $30,000, and $40,000 in 2009, 2010, and 2011, respectively.

Required:
Based on this information, analyze and comment on the changes in the company's performance and its management of accounts receivable and inventory from 2009 to 2011.

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2009 2010 2011 Statement of Financial Position Cash Accounts receivable Inventory Capital assets (net) Other assets S 22,50020,000 25.000 145.000 220,000 500,000 266,400 S 862,000 860,000 $1,156,400 67.500 110,000 430,000 232,000 50,000 130,000 450,000 210,000 Liabilities and equity 100,000 200,000 Current liabilities Long-term debt Share capital common shares 525,000 Retained earnings $50,000 100,000 500,000 525,000 35,000 31,400 $ 862,000 860,000 $1,156.400 250,000 525.000 37,000 Statement of Earnings $ 700,000 800,000 900,000 (420,000 (540,000) 630,000) 170,000) (220,000 (218.000) 52,000 Cost of goods sold Other expenses 110,000 40,000 33,000) 12.000 (5,600) Income tax Net earnings 77,000 S28.000 S36.400