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

question 84

Multiple Choice

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

• A)operating cycle.
• B)inventory period.
• C)accounts receivable period.
• D)accounts payable period.
• E)cash cycle.

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Definitions:

Necessity

A good or service that is essential for survival and basic well-being, often implying inelastic demand with respect to price changes.

Price Elastic Demand

A measure of how much the quantity demanded of a good responds to a change in the price of that good, with a higher elasticity indicating a greater response.

Dental Floss

A thin thread used to remove food and dental plaque from between teeth in areas a toothbrush is unable to reach.

Price Elasticity

Refers to the responsiveness of the quantity demanded or supplied of a good or service to a change in its price.