Ideally a firm would like to have a
A) negative operating cycle.
B) positive operating cycle.
C) negative cash conversion cycle.
D) positive cash conversion cycle.

Question

Quizplus · Accepted Answer

A negative cash conversion cycle means that a firm is able to collect cash from its customers before it has to pay its suppliers for goods or services used to create the product. This is favorable for the firm as it allows them to have a positive cash flow, and to use that cash to fund operations, pay off debt, or invest in new projects.

Ideally a Firm Would Like to Have a