Which One of the Following Will Decrease the Operating Cycle

question 60

Multiple Choice

Which one of the following will decrease the operating cycle?

• A)decreasing the inventory turnover rate
• B)decreasing the accounts payable period
• C)increasing the accounts receivable turnover rate
• D)increasing the accounts payable period
• E)increasing the accounts receivable period

---

Definitions:

Lease Liability

A financial obligation representing the present value of future lease payments owed by a lessee under a lease agreement.

Implicit Lease Rate

The interest rate assumed in the lease payments, often used to calculate the present value of lease payments in lease agreements.

Guaranteed Residual Value

An assurance to lessees that the asset being leased will have a specified value at the end of the lease term, affecting lease payments and financial planning.

Maintenance Agreement

A contractual agreement where one party agrees to maintain assets owned by another party, often including repairs and replacements.