1. Which of the following terms is defined as the length of time between the pur

Question

1. Which of the following terms is defined as the length of time between the purchase of inventory and the date of receipt of cash from the sale of that inventory is called the:

A. Inventory period.

B. Accounts Receivable period.

C. Accounts Payable period.

D. Operating cycle.

E. Cash cycle.

2. Which one of the following transactions is a source of cash?

A. granting credit to a customer

B. purchasing new machinery

C. making a payment on a bank loan

D. purchasing inventory

E. accepting credit from a supplier

3. Which TWO of the following transactions represent uses of cash?

A. Collecting a receivable

B. Increasing inventory

C. Obtaining a bank loan

D. Issuing common stock

E. Paying a supplier for previous purchases

Explanation / Answer

D. Operating cycle

Operating cycle is defined as the amount of time taken between the purchase of inventory and the date of receipt of cash from the sale of that inventory.

Related Questions

Navigate

• Browse (All)
• Browse 1
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.