Which One of the Following Will Decrease the Operating Cycle

question 113

Multiple Choice

Which one of the following will decrease the operating cycle?

• A)Decreasing the days sales in inventory.
• B)Decreasing the days in trade payables.
• C)Decreasing the cash cycle by increasing the trade payables period.
• D)Decreasing the trade receivables turnover rate.
• E)Decreasing the speed at which inventory is sold.

---

Definitions:

Present Value

The immediate value of a future amount of money or a series of payments, discounted at a given rate of return.

Compound Interest

Interest calculated on the initial principal and also on the accumulated interest of previous periods.

Required Rate

The minimum acceptable return on an investment or project, often used in capital budgeting.

Annuity

A fiscal instrument that provides a consistent flow of income to a person, often employed as a revenue source for those in retirement.