When an entity's operating cycle is not clearly identifiable it is assumed to have a duration of:
A) three months.
B) six months.
C) 12 months.
D) 2 years.

Question

Quizplus · Accepted Answer

The assumption is that an entity's operating cycle lasts for a period of 12 months. This assumption is commonly used in financial reporting when the length of the operating cycle is unknown or cannot be easily determined.

When an Entity's Operating Cycle Is Not Clearly Identifiable It