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Working capital

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA AFM Exams › Working capital

  • This topic has 1 reply, 2 voices, and was last updated 11 years ago by John Moffat.
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  • June 1, 2014 at 2:43 pm #172361
    hasanali95
    Member
    • Topics: 239
    • Replies: 248
    • ☆☆☆

    If working cap is to remain constant over the life of the project,do we inflate it each year by the inflation rate to cope up with inflation?

    In the dec 13 q1 the examiner hasnt done so
    At some other place the wc has been inflated

    June 1, 2014 at 7:14 pm #172453
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 54718
    • ☆☆☆☆☆

    Although we would normally inflate the working capital, doing this means injecting more working capital each year.
    In this question it specifically states “It is not expected that any further injections of working capital will be required for the five years”

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