The Practices of Delaying Payments to Suppliers, Speeding Up Collection

question 14

Short Answer

The practices of delaying payments to suppliers, speeding up collection from customers, and earning the greatest possible return on any excess cash are known as ____________________ principles.

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Definitions:

Total Operating Income

The profit achieved from a company's core business operations, excluding deductions of taxes and interest.

Net Cash Inflows

The amount by which the cash inflow from operations exceeds its cash outflow, usually measured within a specific period.

Net Cash Inflow

The excess of cash receipts over cash disbursements during a certain period, reflecting the liquidity generated from operations.

Cash Payback Period

The duration it takes for an investment to generate an amount of cash equal to the initial investment cost.