Choose the Word or Phrase in [ ] Which Will

question 146

Short Answer

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement.
-A proper use of open account credit would be to buy a [food | washing machine].

---

Definitions:

Inventory Period

The average time it takes for inventory to be sold and replaced over a period, a key component of efficiency in supply chain management.

Accounts Payable Period

The average duration it takes for a company to pay off its suppliers after receiving goods or services.

Accounts Receivable Period

The mean duration that a company requires to receive payments from credit sales, reflecting the effectiveness of its policies on credit and collections.

Operating Cycle

The period of time between the acquisition of inventory by a company and the receipt of cash from accounts receivable from the sale of that inventory.