The length of time for which credit is granted to a ﬁrm's customers is called the ____________.

Question

Quizplus · Accepted Answer

The length of time for which credit is granted to a firm's customers is called the credit period. The cash cycle refers to the time it takes for a company to convert its investments in inventory back to cash, while the operating cycle is the time it takes for a company to purchase inventory, sell the inventory, and collect the cash from the sale. The transaction period and disbursement period are not directly related to credit granted to customers.

The Length of Time for Which Credit Is Granted to a ﬁRm's