Dear tutor,
In answer to part a) of this question in calculation of FCF changes in working capital are calculated as changes in ALL current assets (including cash) and changes in all current liabilities (including ST loans and overdraft), is it right? Shouldn't we just calculate changes in inventory, receivables and other payabes?
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q.73 (bpp revision kit_Wurall_6/04,amended)
11y ago#1The answer is correct. We are trying to calculate the cash available for shareholders and therefore changes in the cash balance being maintained will affect the amount available.
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