Typically, the inventory period and the accounts payable period at least partially overlap in the firms operating cycle.

Question

Quizplus · Accepted Answer

This is true because inventory is typically purchased on credit, and the accounts payable period represents the time it takes for the firm to pay its suppliers for goods and services received on credit. Therefore, there is likely to be overlap between the inventory period (the time it takes for the firm to sell its inventory) and the accounts payable period (the time it takes for the firm to pay its suppliers).

Typically, the Inventory Period and the Accounts Payable Period at Least