The Business Operating Cycle Has Two Components: the Production Cycle

question 29

True/False

The business operating cycle has two components: the production cycle and the collection cycle.

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Definitions:

Income

The money received, especially on a regular basis, for work or through investments.

Opportunity Cost

The price paid for not choosing the next most favorable option when deciding or picking between different possibilities.

Term Deposit

A bank deposit with a fixed term and typically a fixed rate of interest, where withdrawal can only occur after the term ends without penalty.

Holding Cash

The practice of keeping money in the form of physical currency as a store of value or for transactions.