The length of time between the payment for inventory and the collection of cash from receivables is called the:
A)operating cycle.
B)inventory period.
C)accounts receivable period.
D)accounts payable period.
E)cash cycle.

Question

Quizplus · Accepted Answer

The length of time between the payment for inventory and the collection of cash from receivables is referred to as the cash cycle. It calculates the time a company takes to buy raw materials, convert them into finished goods, sell them, and collect cash from customers.

The Length of Time Between the Payment for Inventory and the Collection