The operating cycle of a company:
A)Must be less than one year.
B)Is usually greater than one year.
C)Is the time it takes to purchase inventory,sell inventory,and collect cash from the sale.
D)Is the time it takes to acquire a loan,pay the interest,and retire the loan by paying the creditor in full.

Question

Quizplus · Accepted Answer

The operating cycle of a company is the time it takes to purchase inventory, sell inventory, and collect cash from the sale. It involves the process from the purchase of inventory to the receipt of cash from customers. It can be less than or greater than one year depending on the business type and the product's nature.

The Operating Cycle of a Company