Question

Working capital is ______. Multiple select question. treated as a cash inflow when released at the end of a project. not discounted when computing the net present value of an investment treated as a cash outflow when required at the beginning of a project. not treated as a cash flow in an investment project.

Answer 1

Answer:

treated as a cash inflow when released at the end of a project.

Explanation:

A statement of cash flows is also known as cash flow statement and it is a financial statement which is used to illustrate how changes in income and various account of the balance sheet affect cash and cash equivalents.

The statement of cash flows is also used by financial experts or accountants to breakdown the cash-flow analysis into;

1. Cash-flow from operating activities

2. Cash-flow from investing activities.

3. Cash-flow from financing activities.

Basically, a cash inflow can be defined as an amount of money that flows into a business.

In Financial accounting, working capital is calculated by subtracting the value of current liabilities from current assets.

Working capital often increases when a new project is taking up, is treated as a cash inflow when released at the end of a project and it's typically treated as a cash-outflow if it's required at the start (beginning) of a project.