• Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar
Free ACCA & CIMA online courses from OpenTuition

Free ACCA & CIMA online courses from OpenTuition

Free Notes, Lectures, Tests and Forums for ACCA and CIMA exams

  • ACCA
  • CIMA
  • FIA
  • OBU
  • Books
  • Forums
  • Ask AI
  • Search
  • Register
  • Login
  • ACCA Forums
  • Ask ACCA Tutor
  • CIMA Forums
  • Ask CIMA Tutor
  • FIA
  • OBU
  • Buy/Sell Books
  • All Forums
  • Latest Topics

20% off ACCA & CIMA Books

OpenTuition recommends the new interactive BPP books for March and June 2025 exams.
Get your discount code >>

NPV relating to working capital

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FM Exams › NPV relating to working capital

  • This topic has 3 replies, 2 voices, and was last updated 2 years ago by John Moffat.
Viewing 4 posts - 1 through 4 (of 4 total)
  • Author
    Posts
  • November 19, 2022 at 8:31 pm #671887
    meenu71200
    Participant
    • Topics: 21
    • Replies: 13
    • ☆

    Hello mr john, I hope you are good.my ques is

    aw co needs to have $100000 working capital in place immediately for the start of a 2 year project.The amount will stay constant in real terms.Inflation is running at 10% per year ,and aw co’s money cost of capital is 12%.
    what is the present value of the cash flows relating to working capital?

    p.s. in solutions present value is calculated on incremental cash flows. WHY?

    November 20, 2022 at 9:25 am #671903
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 54665
    • ☆☆☆☆☆

    They need at an outflow of $100,000 at time 0.

    At time 1 they need the working capital to be 10% higher, so they need an extra $10,000 in order to bring the working capital up to the $110,000 required.

    Do watch my free lectures on investment appraisal with working capital, because I do explain this point.

    December 2, 2022 at 7:24 am #673093
    meenu71200
    Participant
    • Topics: 21
    • Replies: 13
    • ☆

    Oh yes,now I remember. Thanks so much.

    December 2, 2022 at 7:32 am #673095
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 54665
    • ☆☆☆☆☆

    You are welcome 🙂

  • Author
    Posts
Viewing 4 posts - 1 through 4 (of 4 total)
  • The topic ‘NPV relating to working capital’ is closed to new replies.

Primary Sidebar

Donate
If you have benefited from our materials, please donate

ACCA News:

ACCA My Exam Performance for non-variant

Applied Skills exams is available NOW

ACCA Options:  “Read the Mind of the Marker” articles

Subscribe to ACCA’s Student Accountant Direct

ACCA CBE 2025 Exams

How was your exam, and what was the exam result?

BT CBE exam was.. | MA CBE exam was..
FA CBE exam was.. | LW CBE exam was..

Donate

If you have benefited from OpenTuition please donate.

PQ Magazine

Latest Comments

  • MikeLittle on Civil Law, Common Law, Criminal Law – ACCA Corporate and Business Law (LW) (ENG)
  • beata443c on Civil Law, Common Law, Criminal Law – ACCA Corporate and Business Law (LW) (ENG)
  • heary123@ on Group SFP – Unrealised profit and inventory in transit – ACCA Financial Reporting (FR)
  • heary123@ on Group SFP – Unrealised profit and inventory in transit – ACCA Financial Reporting (FR)
  • John Moffat on PM Chapter 15 Questions Financial Performance Measurement

Copyright © 2025 · Support · Contact · Advertising · OpenLicense · About · Sitemap · Comments · Log in