Operating cycle: Operating cycle is the chain of business activities performed in an organization. An organization can be manufacturing, servicing of merchandising type. For a merchandiser, the main business activities are the purchase, payment to the supplier, sales, and receipts from the customer. Hence the operating cycle of a merchandiser is limited as compared with the operating cycle of a manufacturer. The Operating cycle mainly includes following activities: •Purchases from the supplier (either cash or on account) •Payment to suppliers •Inventory •Sales (either cash or on account) •Collection from customer The formula to calculate the operating cycle is as follows: Net Operating Cycle = Inventory Period + Accounts Receivable Period − Accounts Payable Period. Requirement-1: To Indicate: The correct match for each business with its operating cycle description.

Question

Want to see the full answer?

Answer 1

Question

Chapter 4, Problem 53E

To determine

Concept Introduction:

Operating cycle:

Operating cycle is the chain of business activities performed in an organization. An organization can be manufacturing, servicing of merchandising type. For a merchandiser, the main business activities are the purchase, payment to the supplier, sales, and receipts from the customer. Hence the operating cycle of a merchandiser is limited as compared with the operating cycle of a manufacturer.

The Operating cycle mainly includes following activities:

•Purchases from the supplier (either cash or on account)

•Payment to suppliers

•Inventory

•Sales (either cash or on account)

•Collection from customer

The formula to calculate the operating cycle is as follows:

Net Operating Cycle = Inventory Period + Accounts Receivable Period − Accounts Payable Period.

Requirement-1:

To Indicate:

The correct match for each business with its operating cycle description.

To determine

Concept Introduction:

Operating cycle:

Operating cycle is the chain of business activities performed in an organization. An organization can be manufacturing, servicing of merchandising type. For a merchandiser, the main business activities are the purchase, payment to the supplier, sales, and receipts from the customer. Hence the operating cycle of a merchandiser is limited as compared with the operating cycle of a manufacturer.

The Operating cycle mainly includes following activities:

•Purchases from the supplier (either cash or on account)

•Payment to suppliers

•Inventory

•Sales (either cash or on account)

•Collection from customer

The formula to calculate the operating cycle is as follows:

Net Operating Cycle = Inventory Period + Accounts Receivable Period − Accounts Payable Period.

Requirement-2:

To Indicate:

The effect of longer operating cycle on financial needs of the company.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Students have asked these similar questions

Problem 7.4A Recording sales transactions, posting to the accounts receivable ledger, and preparing a schedule of accounts receivable. The Problem is attached.

fill in blanks please

Help with February journal entries & ledger

Answer 2

Question

Chapter 4, Problem 53E

To determine

Concept Introduction:

Operating cycle:

Operating cycle is the chain of business activities performed in an organization. An organization can be manufacturing, servicing of merchandising type. For a merchandiser, the main business activities are the purchase, payment to the supplier, sales, and receipts from the customer. Hence the operating cycle of a merchandiser is limited as compared with the operating cycle of a manufacturer.

The Operating cycle mainly includes following activities:

•Purchases from the supplier (either cash or on account)

•Payment to suppliers

•Inventory

•Sales (either cash or on account)

•Collection from customer

The formula to calculate the operating cycle is as follows:

Net Operating Cycle = Inventory Period + Accounts Receivable Period − Accounts Payable Period.

Requirement-1:

To Indicate:

The correct match for each business with its operating cycle description.

To determine

Concept Introduction:

Operating cycle:

Operating cycle is the chain of business activities performed in an organization. An organization can be manufacturing, servicing of merchandising type. For a merchandiser, the main business activities are the purchase, payment to the supplier, sales, and receipts from the customer. Hence the operating cycle of a merchandiser is limited as compared with the operating cycle of a manufacturer.

The Operating cycle mainly includes following activities:

•Purchases from the supplier (either cash or on account)

•Payment to suppliers

•Inventory

•Sales (either cash or on account)

•Collection from customer

The formula to calculate the operating cycle is as follows:

Net Operating Cycle = Inventory Period + Accounts Receivable Period − Accounts Payable Period.

Requirement-2:

To Indicate:

The effect of longer operating cycle on financial needs of the company.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 3

Question

Chapter 4, Problem 53E

To determine

Concept Introduction:

Operating cycle:

Operating cycle is the chain of business activities performed in an organization. An organization can be manufacturing, servicing of merchandising type. For a merchandiser, the main business activities are the purchase, payment to the supplier, sales, and receipts from the customer. Hence the operating cycle of a merchandiser is limited as compared with the operating cycle of a manufacturer.

The Operating cycle mainly includes following activities:

•Purchases from the supplier (either cash or on account)

•Payment to suppliers

•Inventory

•Sales (either cash or on account)

•Collection from customer

The formula to calculate the operating cycle is as follows:

Net Operating Cycle = Inventory Period + Accounts Receivable Period − Accounts Payable Period.

Requirement-1:

To Indicate:

The correct match for each business with its operating cycle description.

To determine

Concept Introduction:

Operating cycle:

Operating cycle is the chain of business activities performed in an organization. An organization can be manufacturing, servicing of merchandising type. For a merchandiser, the main business activities are the purchase, payment to the supplier, sales, and receipts from the customer. Hence the operating cycle of a merchandiser is limited as compared with the operating cycle of a manufacturer.

The Operating cycle mainly includes following activities:

•Purchases from the supplier (either cash or on account)

•Payment to suppliers

•Inventory

•Sales (either cash or on account)

•Collection from customer

The formula to calculate the operating cycle is as follows:

Net Operating Cycle = Inventory Period + Accounts Receivable Period − Accounts Payable Period.

Requirement-2:

To Indicate:

The effect of longer operating cycle on financial needs of the company.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 4

Question

Chapter 4, Problem 53E

To determine

Concept Introduction:

Operating cycle:

Operating cycle is the chain of business activities performed in an organization. An organization can be manufacturing, servicing of merchandising type. For a merchandiser, the main business activities are the purchase, payment to the supplier, sales, and receipts from the customer. Hence the operating cycle of a merchandiser is limited as compared with the operating cycle of a manufacturer.

The Operating cycle mainly includes following activities:

•Purchases from the supplier (either cash or on account)

•Payment to suppliers

•Inventory

•Sales (either cash or on account)

•Collection from customer

The formula to calculate the operating cycle is as follows:

Net Operating Cycle = Inventory Period + Accounts Receivable Period − Accounts Payable Period.

Requirement-1:

To Indicate:

The correct match for each business with its operating cycle description.

To determine

Concept Introduction:

Operating cycle:

Operating cycle is the chain of business activities performed in an organization. An organization can be manufacturing, servicing of merchandising type. For a merchandiser, the main business activities are the purchase, payment to the supplier, sales, and receipts from the customer. Hence the operating cycle of a merchandiser is limited as compared with the operating cycle of a manufacturer.

The Operating cycle mainly includes following activities:

•Purchases from the supplier (either cash or on account)

•Payment to suppliers

•Inventory

•Sales (either cash or on account)

•Collection from customer

The formula to calculate the operating cycle is as follows:

Net Operating Cycle = Inventory Period + Accounts Receivable Period − Accounts Payable Period.

Requirement-2:

To Indicate:

The effect of longer operating cycle on financial needs of the company.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 5

Chapter 4, Problem 53E

To determine

Concept Introduction:

Operating cycle:

Operating cycle is the chain of business activities performed in an organization. An organization can be manufacturing, servicing of merchandising type. For a merchandiser, the main business activities are the purchase, payment to the supplier, sales, and receipts from the customer. Hence the operating cycle of a merchandiser is limited as compared with the operating cycle of a manufacturer.

The Operating cycle mainly includes following activities:

•Purchases from the supplier (either cash or on account)

•Payment to suppliers

•Inventory

•Sales (either cash or on account)

•Collection from customer

The formula to calculate the operating cycle is as follows:

Net Operating Cycle = Inventory Period + Accounts Receivable Period − Accounts Payable Period.

Requirement-1:

To Indicate:

The correct match for each business with its operating cycle description.

To determine

Concept Introduction:

Operating cycle:

Operating cycle is the chain of business activities performed in an organization. An organization can be manufacturing, servicing of merchandising type. For a merchandiser, the main business activities are the purchase, payment to the supplier, sales, and receipts from the customer. Hence the operating cycle of a merchandiser is limited as compared with the operating cycle of a manufacturer.

The Operating cycle mainly includes following activities:

•Purchases from the supplier (either cash or on account)

•Payment to suppliers

•Inventory

•Sales (either cash or on account)

•Collection from customer

The formula to calculate the operating cycle is as follows:

Net Operating Cycle = Inventory Period + Accounts Receivable Period − Accounts Payable Period.

Requirement-2:

To Indicate:

The effect of longer operating cycle on financial needs of the company.

Answer 6

Chapter 4, Problem 53E

To determine

Concept Introduction:

Operating cycle:

Operating cycle is the chain of business activities performed in an organization. An organization can be manufacturing, servicing of merchandising type. For a merchandiser, the main business activities are the purchase, payment to the supplier, sales, and receipts from the customer. Hence the operating cycle of a merchandiser is limited as compared with the operating cycle of a manufacturer.

The Operating cycle mainly includes following activities:

•Purchases from the supplier (either cash or on account)

•Payment to suppliers

•Inventory

•Sales (either cash or on account)

•Collection from customer

The formula to calculate the operating cycle is as follows:

Net Operating Cycle = Inventory Period + Accounts Receivable Period − Accounts Payable Period.

Requirement-1:

To Indicate:

The correct match for each business with its operating cycle description.

Answer 7

Chapter 4, Problem 53E

To determine

Concept Introduction:

Operating cycle:

Operating cycle is the chain of business activities performed in an organization. An organization can be manufacturing, servicing of merchandising type. For a merchandiser, the main business activities are the purchase, payment to the supplier, sales, and receipts from the customer. Hence the operating cycle of a merchandiser is limited as compared with the operating cycle of a manufacturer.

The Operating cycle mainly includes following activities:

•Purchases from the supplier (either cash or on account)

•Payment to suppliers

•Inventory

•Sales (either cash or on account)

•Collection from customer

The formula to calculate the operating cycle is as follows:

Net Operating Cycle = Inventory Period + Accounts Receivable Period − Accounts Payable Period.

Requirement-1:

To Indicate:

The correct match for each business with its operating cycle description.

Answer 8

To determine

Concept Introduction:

Operating cycle:

Operating cycle is the chain of business activities performed in an organization. An organization can be manufacturing, servicing of merchandising type. For a merchandiser, the main business activities are the purchase, payment to the supplier, sales, and receipts from the customer. Hence the operating cycle of a merchandiser is limited as compared with the operating cycle of a manufacturer.

The Operating cycle mainly includes following activities:

•Purchases from the supplier (either cash or on account)

•Payment to suppliers

•Inventory

•Sales (either cash or on account)

•Collection from customer

The formula to calculate the operating cycle is as follows:

Net Operating Cycle = Inventory Period + Accounts Receivable Period − Accounts Payable Period.

Requirement-2:

To Indicate:

The effect of longer operating cycle on financial needs of the company.

Answer 9

To determine

Concept Introduction:

Operating cycle:

Operating cycle is the chain of business activities performed in an organization. An organization can be manufacturing, servicing of merchandising type. For a merchandiser, the main business activities are the purchase, payment to the supplier, sales, and receipts from the customer. Hence the operating cycle of a merchandiser is limited as compared with the operating cycle of a manufacturer.

The Operating cycle mainly includes following activities:

•Purchases from the supplier (either cash or on account)

•Payment to suppliers

•Inventory

•Sales (either cash or on account)

•Collection from customer

The formula to calculate the operating cycle is as follows:

Net Operating Cycle = Inventory Period + Accounts Receivable Period − Accounts Payable Period.

Requirement-2:

To Indicate:

The effect of longer operating cycle on financial needs of the company.

Answer 10

Expert Solution & Answer

Answer 11

Expert Solution & Answer

Answer 12

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 13

Ch. 4 - Prob. 1DQ Ch. 4 - Prob. 2DQ Ch. 4 - The Sarbanes-Oxley Act increased top managements...Ch. 4 - Prob. 4DQ Ch. 4 - Prob. 5DQ Ch. 4 - Prob. 6DQ Ch. 4 - Prob. 7DQ Ch. 4 - Prob. 8DQ Ch. 4 - Prob. 9DQ Ch. 4 - Prob. 10DQ

Solution Summary: The author introduces the concept of operating cycle, which is the chain of business activities performed in an organization.

Want to see the full answer?

Chapter 4 Solutions