Which Activity Is Not Part of the Operating Cycle

question 70

Multiple Choice

Which activity is not part of the operating cycle?

• A)Repaying a bank loan used to purchase manufacturing equipment
• B)Purchasing goods from suppliers for resale to customers
• C)Paying employees for hours worked
• D)Collecting cash from sales on account made last month

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Definitions:

Payment Stream

A sequence of payments made over time, often associated with loans or investments.

Effective Yield

A measure of the return on an investment, taking into account the effect of compounding interest.

Bond Price

The amount of money investors are willing to pay for a bond, which can fluctuate based on interest rates, credit risk, and other factors.

Perpetuity

A type of financial instrument that pays a fixed sum to the holder indefinitely, without a maturity date.