Which of the following is the best description of the operating cycle?

Multiple Choice

The length of time that it takes to convert raw materials into inventory

The length of time that it takes to convert raw materials into accounts receivable

The length of time to acquire raw materials and receive payment for them when sold

None of the options

Carrying costs are associated with having current assets and fall into which general category?

Multiple Choice

The opportunity costs associated with having capital tied up in current assets instead of more productive fixed assets.

Explicit costs necessary to maintain the value of current assets.

both a and b

neither a or b

Which of the following current asset financing policies reflects the firm financing the seasonally-adjusted average level of asset demand with long-term debt and equity enabling it to use both short-term financing and short-term investing as needed?

Multiple Choice

Flexible financing policy

Restrictive financing policy

Compromise financing policy

Alternative financing policy