Question
Which of the following statements is FALSE? Select one: a. The main components of net working capital are cash, inventory, receivables, and payables. b. If
Which of the following statements is FALSE? Select one:
a. The main components of net working capital are cash, inventory, receivables, and payables.
b. If the firm pays cash for its inventory, the firm's operating cycle is identical to the firm's cash cycle.
c. The firm's operating cycle is the average length of time between when a firm originally purchases its inventory and when it receives the cash back from selling its product.
d. Working capital includes the cash that is needed to run the firm on a day-to-day basis, also includes excess cash that is not required to run the business and can be invested at a market rate.
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