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Question $15$

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Question text

The cash operating cycle is defined as the overall time$-$lag between the cash payment for inputs and the cash receipts for output.

Which of the following statements represents the correct formula for the cash operating cycle?

$1.$

Debtor$$s time$-$lag plus raw material time$-$lag, minus creditor$$s time$-$lag plus work$-$in progress time$-$lag minus finished goods time$-$lag.

$2.$

Finished goods time$-$lag minus creditor$$s time$-$lag plus debtor$$s time$-$lag.

$3.$

Work$-$in progress time$-$lag plus raw material time$-$lag plus finished goods time$-$lag plus debtor$$s time$-$lag minus creditor$$s time$-$lag.

$4.$

Creditor$$s time$-$lag plus debtor$$s time$-$lag plus raw material time$-$lag minus work$-$in progress time$-$lag minus finished goods time$-$lag.