The Operating Cycle Is Defined As

question 12

Multiple Choice

The operating cycle is defined as:

• A)The average time it takes firms to acquire inventory, sell it, and receive payment
• B)The average time it takes to convert raw materials into finished goods
• C)The average time it takes to generate profit from operations
• D)The average time it takes a firm to sell its inventory and receive payment

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Definitions:

Minor Failure

A small or insignificant defect or flaw, especially in a product, system, or mechanism, that does not generally inhibit its intended function.

Repudiation

The rejection or refusal to acknowledge or pay a debt or fulfill a contractual obligation, often leading to a breach of contract claim.

Frustration

A legal doctrine that excuses parties from fulfilling their contract obligations due to unforeseen circumstances rendering the contract impossible, illegal, or radically different.

Frustrating Event

An unforeseen event that significantly changes the conditions of a contract, making it impossible to fulfill and potentially voiding the agreement.