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Net Working Capital

Determine the change in net working capital that appears warranted for the following proposed project: Inventory levels will increase 20% from their current value of $500,000; cash will increase by $25,000; wage accruals will increase by $60,000; machinery will increase by $75,000; accounts receivable -- because of a new collection system -- will increase by only $15,000; accounts payable will increase by $45,000. What happens to net working capital at the end of the project's life?

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Determine the change in net working capital that appears warranted for the following proposed project: Inventory levels will increase 20% from their
current value of $500,000; cash will increase by $25,000; wage accruals will increase by $60,000; machinery will increase by $75,000; accounts receivable--
because of a new collection ...

Solution Summary

Determine the change in net working capital that appears warranted for the following proposed project: Inventory levels will increase 20% from their current value of $500,000; cash will increase by $25,000; wage accruals will increase by $60,000; machinery will increase by $75,000; accounts receivable -- because of a new collection system -- will increase by only $15,000; accounts payable will increase by $45,000. What happens to net working capital at the end of the project's life?

$2.19