Answer: Question in incomplete as it is probably missing 3rd option C.
Which is "average time required to turning goods into cash".
Explanation:
Operating cycle depicts the length of time it takes a company to buy inventory, convert it into sales and collect the "accounts receivable" revenue from the sales.
A company with an extremely short operating cycle requires less cash to maintain its operations.
Answer:
A : the average time required to produce goods for resale.
Explanation:
Operating cycle of a business involves obtaining cash for production, production of goods and sale of the goods to the customer for cash.
Some companies have extremely short operating cycle (such as retail business), while for others it is longer (for example real estate)
So the other option of operating cycle being one year is incorrect. Operating cycle is unique to the business and its market dynamics.
