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You Are a Doctor and a Patient Comes to You

question 49

Multiple Choice

You are a doctor and a patient comes to you for a checkup. He expresses that his father recently had a heart attack brought on by atherosclerosis. He wants to know what he should do to lower his risk of also having a heart attack. Which of the following statements might you make to him?


Definitions:

Operating Cycle

The operating cycle is the time period it takes for a company to purchase inventory, sell it, and convert the sale into cash.

Cash Cycles

The amount of time it takes for a business to convert its investments in inventory and other resources into cash flows from sales.

Accounts Payable Turnover

A financial ratio that measures the rate at which a company pays off its suppliers by comparing total purchases to average accounts payable.

Inventory Sold

The total cost of goods or merchandise a business has sold to customers during a specific period, key for calculating cost of goods sold.

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