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Which One of the Following Statements Is True,all Else Constant

Question 22

Multiple Choice

Which one of the following statements is true,all else constant?


A) A decrease in the accounts receivable turnover rate decreases the cash cycle.
B) Paying a supplier within the discount period, rather than waiting until the end of the normal credit period, will decrease the cash cycle.
C) The cash cycle can never be negative.
D) An increase in the inventory turnover rate will decrease the cash cycle.
E) The payables period must be shorter than the receivables period.

Correct Answer:

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