The Ability of a Business to Return Money Earned in a Foreign

question 152

Multiple Choice

The ability of a business to return money earned in a foreign country back to its home country is called:

• A) currency transferability
• B) exchange control
• C) exchange ability
• D) credit fluidity
• E) none of the other specific choices are correct

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Definitions:

Average Collection Period

The typical time frame for a company to receive dues from its clients for goods or services offered on credit.

Operating Cycle

The duration of time it takes for a company to buy inventory, sell it, and convert the sale into cash.

Cash Disbursements

Money paid out by a company for expenses, operations, or investments.

Accounts Receivable Period

The accounts receivable period is the average number of days it takes for a company to collect payments owed by its customers after a sale has been made.