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Leni [432]
3 years ago
14

A new project would require an immediate increase in raw materials in the amount of $12,000. The firm expects that accounts paya

ble will automatically increase $8,500. How much must the firm expect its investment in net working capital to change if they accept this project
Business
1 answer:
Mariulka [41]3 years ago
6 0

Answer: Increase by $3,500

Explanation:

The Net Working Capital of a company is calculated by subtracting Current liabilities from current assets.

Raw materials are current assets and Accounts Payable are current liabilities.

The Net working capital resulting from accepting this project is;

= 12,000 - 8,500

= $3,500

Net Working capital investment would increase by $3,500.

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Explanation:

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2. Income from multiple sources: Always do not depend on single income. Make sure that income comes from multiple sources so that you can make your business alive.

3. Have a savings: Entrepreneurs should save money as how much as they can. We cannot know when there will be a profit and when there is a loss. We can only forecast to a particular extent.

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In the case of family income and family spending, it is easy to see that both rise or fall together in the same direction. This is called a positive correlation.

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What is a rental inventory and why is it a good idea to have one?
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A rental inventory is basically like people rent you things. Cars, and lots of stuff. its a good idea to have a rental inventory because you can rent people things in a business.

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