Charles Is the Purchase Agent for a Consulting Firm

question 56

Multiple Choice

Charles is the purchase agent for a consulting firm.He places orders for office stationeries and consumables once in two weeks.The purchases are made in large quantities and are billed in the firm's name.The items that Charles buys are examples of ________.

• A) specialty products
• B) expense items
• C) capital items
• D) shopping products
• E) convenience products

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Definitions:

Operating Cycle

The average period of time required for a business to convert its investments in inventory back into cash through the sale of goods or services.

Merchandise

Products or goods that are bought, sold, or traded within a retail environment.

Long-Term Assets

Assets that a company intends to hold for more than one year, including property, plant, and equipment.

Balance Sheet

A financial statement that summarizes a company's assets, liabilities, and shareholders' equity at a specific point in time, showing the company's financial condition.