BP Has an Operating Cycle of 120 Days,an Average Collection

question 2

Multiple Choice

BP has an operating cycle of 120 days,an average collection period of 40 days,and an average payment period of 30 days.Based on this information,BPs average age of inventory is ________ days.

• A)50
• B)60
• C)70
• D)80
• E)none of the above

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Definitions:

Excess Liquidity

The situation in which an individual or entity has more liquid assets available than is necessary for immediate operational needs.

Freeze-Out

happens in a corporate context when majority shareholders exclude minority shareholders from decision-making, often to coerce them into selling their shares.

Minority Shareholders

Individuals or entities that own a smaller portion of a company's shares, thus having less influence over corporate decisions than majority shareholders.

Type Of Oppression

Refers to unfair or unjust treatment or control, especially in a legal context, where one party uses their position to unduly suppress or burden another.