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sergiy2304 [10]
3 years ago
12

A new project would require an immediate increase in raw materials in the amount of $1,000. The firm expects that accounts payab

le will automatically increase $800. How much must the firm expect its investment in net working capital to change if they accept this project?
a. +$1,800b. +$200c. −$200d. −$1,800
Business
1 answer:
disa [49]3 years ago
8 0

Answer:

b) +$200

Explanation:

Net Working Capital (NWC)  or simply Working capital is the calculation between an organisation's current assets including accounts receivable, inventory and cash and the organisation's current liabilities including payables and advances among others. It simply measures how liquid an organisation is enough to meet its current obligations (liabilities).

Calculate: The Net working Capital if the new project is accepted

=NWC= Current assets - current liabilities

Increase in raw materials is a current asset = $1000

Increase in accounts payable is a current liability= $800

Therefore NWC = $1,000 - $800

=$200

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A. the repairs do not extend beyond the damage suffered.
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3 years ago
During a certain four-month period, the consumer price index (CPI) increased by only 5%. But during the next four-month period,
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3 years ago
Read 2 more answers
One of your customers is delinquent on his accounts payable balance. you’ve mutually agreed to a repayment schedule of $750 per
liubo4ka [24]
In this problem, we need to find the length of an annuity. We already identified the interest rate, the PV, and the payments.
Using the PVA equation: PVA =C({1 – [1/(1 +r)t]} /r
$18,000 = $750{[1 – (1/1.019) t] / 0.019}
Then solve for t:
1/1.019t= 1 − {[($18,000)/($750)](0.019)}
1/1.019t= 0.544
1.019t= 1/(0.544) = 1.838
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4 0
3 years ago
Carrie Tune will receive $31,000 for the next 11 years as a payment for a new song she has written. Use Appendix D for an approx
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Answer:

$184,068.70

Explanation:

Given that

Annual payments = $31,000

Discount rate = 12%

Time period = 11 years

The computation of the present value is shown below:

= Annual payments  × PVIFA factor for 11 years at 12%

= $31,000 × 5.9377

= $184,068.70

Simply we multiplied the annual payments with the PVIFA factor so that the present value could arrive

Refer to the PVIFA table

6 0
3 years ago
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