An operating cycle
A) is twelve months or less in length.
B) is the average time required for a company to collect its receivables.
C) is used to determine current assets when the operating cycle is longer than one year.
D) starts with inventory and ends with cash.

Question

Quizplus · Accepted Answer

An operating cycle is used to determine current assets when the operating cycle is longer than one year, as it reflects the time it takes for a company to turn its inventory into cash.

An Operating Cycle