An Entity's Net Operating Cycle Represents _______

question 154

Multiple Choice

An entity's net operating cycle represents _______.

• A)the time from using cash to purchasing goods or services to collecting cash from the sale of goods or services
• B)the time from receiving cash to purchasing goods or services to collecting cash from the sale of goods or services
• C)the time from using cash to selling goods or services to collecting cash from the sale of goods or services
• D)the time from using cash to purchase property, plant, and equipment to collecting on the sale of receivables.

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Definitions:

Proprietary Fund

A type of governmental accounting fund used to account for activities that are similar to those found in the private sector, where the intent is to recover costs through user charges.

Financial Statement

Documented records summarizing a business's financial condition and operations over a period.

Statement of Net Position

A financial statement detailing an entity's assets, liabilities, and net position at a particular point in time, providing a snapshot of financial health.

Tax Abatement

A reduction or elimination of taxes granted by governments to encourage certain activities, such as investments in property development.