Which of the Following Is the Best Description of the Operating

question 64

Multiple Choice

Which of the following is the best description of the operating cycle?

• A) The length of time that it takes to convert raw materials into inventory
• B) The length of time that it takes to convert raw materials into accounts receivable
• C) The length of time to acquire raw materials and receive payment for them when sold
• D) None of the options

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Definitions:

Exchange Rates

The exchange rate determining the value of one currency in relation to another.

Goodwill Impairment

The decrease in value of a company's goodwill, indicating that the value of acquired assets has fallen below their book value.

Fair Value

The amount to be banked from asset liquidation or spent on liability transition in an orderly market dealing at the time for calculating value.

Functional Currency

It's the currency of the primary economic environment in which an entity operates and generates cash flows.