A company's operating cycle refers to the average time that is required to go from cash to: cash in producing revenues.
What is an operating cycle?
An operating cycle can be defined as the average time that it takes a company or business organization to buy goods, sell these goods and generate revenue (cash) from the sales of the goods.
This ultimately implies that, an operating cycle is simply the average time that is required to go from cash to cash in producing revenues, especially from the sales of the goods.
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