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Hello…
How did the examiner arrive at the “revised overdraft level” in the answers?
I am a bit puzzled by your question, because he has shown the workings for it in his answer.
The net working capital (current assets – current liabilities) is $300,800 and the question says that this is not going to change.
We are able to calculate receivables, inventories, and payables (because we know receivables days etc.) then so the overdraft is the missing figure to make the net working capital equal to $300,800.
The way in which you explained what he did now made sense to me as opposed to just copying what the examiner did.
Thanks! 🙂
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