Answered: The companies dispose their accounts…

The companies dispose their accounts receivables due to a. Shortage of accounting staff b. Billing and collection expense are cos

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Concept explainers

Conversion Cycle

Conversion cycle is also known as cash cycle or net operating cycle. Conversion cycle refers to how much time a company takes to turn its investments which is done from stock or any other financial resources into cash flows from sales.

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The companies dispose their accounts receivables due to a. Shortage of accounting staff b. Billing and collection expense are costly c. There are other ways to earn cash d. The accounts receivable are all good

Definition Definition Money that the business will be receiving from its clients who have utilized the credit provided to buy its goods and services. The credit period typically lasts for a short term, lasting from a few days, a few months, to a year.

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