Question : -------------- is the time between the acquisition of an asset for processing and its Realization into "Cash and Cash Equivalents.”
Option 1: Operating cycle
Option 2: Accounting period
Option 3: Financial year
Option 4: None of the above
Correct Answer: Operating cycle
Solution : Answer = Operating cycle
The term "operating cycle" refers to the time duration from the acquisition of an asset for processing or production to its eventual conversion into cash or cash equivalents through sales. It represents the period during which a company invests in inventory, incurs expenses, and generates revenue from sales to customers. Hence, the correct option is 1.
Question : Which of the following statements is not true, with respect to operating cycles?
Option 1: Operating cycle cannot be identified, it is assumed to be of 13 months.
Option 2: Operating Cycle means the time taken by a company to acquire an asset for processing and Converting it into Cash and Cash Equivalents.
Option 3: Operating Cycle is determined for each class of business separately.
Option 4: All of the above
Question : Net Increase/Decrease in cash and cash equivalents + Cash and Cash equivalents at the beginning of the period =..........
Option 1: Cash and Cash equivalents at the end of the period
Option 2: Cash flow from operating Activities
Option 3: Cash flow from investing Activities
Option 4: Cash flow from Financing Activities
Question : _______________are the acquisition and disposal of Long-term Assets and other investments not included in cash equivalents.
Option 1: Operating Activities
Option 2: Investing Activities
Option 3: Financing Activities
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