New Oaks Winery Requires Two Months to Make Wine, Two

question 43

Multiple Choice

New Oaks Winery requires two months to make wine, two years to age it, one month to bottle it, two months to sell it, and one month to collect the receivable. Its operating cycle is:

• A) Twelve months.
• B) Thirty months.
• C) Six months.
• D) Three months.

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Definitions:

Investment Centre Performance

An evaluation of a business unit's profitability and efficiency in managing its assets to generate profits.

Organisation's Minimum Required Rate Of Return

The lowest acceptable return on investment that an organization deems necessary, reflecting its risk tolerance and financial objectives.

Capital Invested

The total amount of money that has been put into a company's projects, assets, or business endeavors to generate growth or profits.

Total Sales

The complete sum of all sales transactions made by a business within a specified period.