Which of the following statements about a company's operating cycle is not true:

a. The operating cycle is the time span from when cash is used to acquire goods and services until cash is received from the sale of goods and services.

b. Most operating cycles are less than one year.

c. Non-current items are those expected to come due within one year or the company's operating cycle.

d. The length of a company's operating cycle depends on its activities.

e. For a merchandiser selling products, the operating cycle is the time span between paying suppliers for merchandise and receiving cash from customers.

Question

Darryl

Business

28 October, 22:40

Which of the following statements about a company's operating cycle is not true:

a. The operating cycle is the time span from when cash is used to acquire goods and services until cash is received from the sale of goods and services.

b. Most operating cycles are less than one year.

c. Non-current items are those expected to come due within one year or the company's operating cycle.

d. The length of a company's operating cycle depends on its activities.

e. For a merchandiser selling products, the operating cycle is the time span between paying suppliers for merchandise and receiving cash from customers.

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Answers (1)

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Brock · Answer 1

The option is C. Non-current items are those expected to come due within one year or the company's operating cycle.

Explanation:

First of all we have to define what is an operating cycle.

The Operating Cycle is the amount of time that occurs between the initial purchase of merchandise from suppliers to when they receive payment from the customer.

The companies these days are investing a big quantity of resources to streamline their operating cycle.

The statement Non-current items are those expected to come due within one year or the company's operating cycle is not true because this is the definition of current items. non-current items are those that are expected to be realized/settled after one year or operating cycle.

Companies nowadays invest a multitude of resources to streamline their Operating Cycle. The Operating Cycle is the amount of time that occurs between the initial purchase of merchandise from suppliers to when they receive payment from the customer.