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Net Working Capital

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Cash Flows and Working Capital. A firm's balance sheets for year-end 2000 and 2001 contain the following data. What happened to investment in net working capital during 2001? All items are in millions of dollars.

Dec. 31, 2000 Dec. 31, 2001
Accounts receivable 32 35
Inventories 25 30
Accounts payable 12 25

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The solution explains how to calculate the investment in net working capital.

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