Which of the following is true about the operating cycle concept? It causes the distinction between current and non-current items to depend on whether they will affect cash within one year. It permits some assets to be classified as current even though they are more than one year removed from becoming cash It affects the income statement but not the statement of cash flows The period covered is the time normally required to convert cash invested in tangible assets back into cash, or 12-months, whichever is longer.
Which of the following is true about the operating cycle concept? It causes the distinction between current and non-current items to depend on whether they will affect cash within one year. It permits some assets to be classified as current even though they are more than one year removed from becoming cash It affects the income statement but not the statement of cash flows The period covered is the time normally required to convert cash invested in tangible assets back into cash, or 12-months, whichever is longer.
Financial Accounting Intro Concepts Meth/Uses
14th Edition
ISBN:9781285595047
Author:Weil
Publisher:Weil
Chapter6: Statement Of Cash Flows
Section: Chapter Questions
Problem 27E
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Which of the following is true about the operating cycle concept?
-
- It causes the distinction between current and non-current items to depend on whether they will affect cash within one year.
- It permits some assets to be classified as current even though they are more than one year removed from becoming cash
- It affects the income statement but not the statement of cash flows
- The period covered is the time normally required to convert cash invested in tangible assets back into cash, or 12-months, whichever is longer.
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