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Exam CLTD topic 1 question 12 discussion

Actual exam question from APICS's CLTD

Question #: 12
Topic #: 1

[All CLTD Questions]

An operations manager in concerned that the order-to-cash cycle for their largest customer is too long. The manager is referring to the time that elapses from when the company receives an order from the customer until the:

A. customer processes payment.
B. warehouse in notified to ship the goods.
C. customer receives that order in inventory.
D. company receives payment.

Show Suggested Answer

Suggested Answer: C 🗳️

by nprestel at Oct. 9, 2020, 6:05 p.m.

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sparkyh

6 months, 3 weeks ago

D. company receives payment. D is incorrect because the company receiving payment comes after the customer has processed payment.

upvoted 1 times

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jackattack030

1 year, 3 months ago

Answer D Order-to-cash cycle, what he calls end-to-end throughput, in aggregate units and/or revenue dollars. The order-to-cash cycle starts with a customer order and ends when raw material suppliers receive their cash.

upvoted 2 times

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Z_nightranger

1 year, 4 months ago

C is true. Customers receive inventory before AP processes invoice. This is a case of getting goods to the customer faster so payment process can be accelerated.

upvoted 1 times

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alinmar

3 years, 3 months ago

Agree correct answer D

upvoted 3 times

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nprestel

3 years, 6 months ago

Answer is D. Order-to-Case cycle ends when payment is processed and received from the customer. Customer internal inventory status has no bearing on the seller.