An entity's net operating cycle represents _______.
A)the time from using cash to purchasing goods or services to collecting cash from the sale of goods or services
B)the time from receiving cash to purchasing goods or services to collecting cash from the sale of goods or services
C)the time from using cash to selling goods or services to collecting cash from the sale of goods or services
D)the time from using cash to purchase property, plant, and equipment to collecting on the sale of receivables.

Question

Quizplus · Accepted Answer

Net operating cycle refers to the period starting from buying raw materials, converting them into finished goods, and then selling them to consumers until the cash is collected from customers. Option A is the only choice that accurately represents this cycle.

An Entity's Net Operating Cycle Represents _______