The Length of Time Between the Sale of Inventory and the Collection

question 92

Multiple Choice

The length of time between the sale of inventory and the collection of cash from receivables is called the:

• A)operating cycle.
• B)inventory period.
• C)trade receivables period.
• D)trade payables period.
• E)cash cycle.

---

Definitions:

Equilibrium Quantity

The quantity of goods or services that is supplied and demanded at the equilibrium price in a market.

Unregulated Market

A market where economic activities are freely carried out without governmental intervention in terms of prices, production, and distribution.

Shortage

A situation where the demand for a product or service exceeds the supply available at a specific price.

Product

Any good, service, or idea that can be offered to a market to satisfy a want or need.