• 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 Books

Books for Sept'23 ACCA exams : Get your discount code >>

New! Ask ACCA AI Tutor

Post your questions
& get instant answers

working capital in cash flow

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FM Exams › working capital in cash flow

  • This topic has 3 replies, 2 voices, and was last updated 3 months ago by John Moffat.
Viewing 4 posts - 1 through 4 (of 4 total)
  • Author
    Posts
  • June 26, 2023 at 7:42 pm #687450
    alawi sayed
    Participant
    • Topics: 212
    • Replies: 252
    • ☆☆☆

    Hello Sir,

    With regard to discounting cash flows.

    If we are told for example that there would be a 10% of sales working capital required in each beginning of the year for example for four years

    So if the required working capital in year 2 is $2000 and the working capital of year one is $1800
    then we have to add $200 only as working capital in year 2 .

    But here why are assuming always that the working capital is still available, may be its already used or got reduced

    Is there a situation we may encounter similar to this in the exam.

    Thanks.

    June 27, 2023 at 8:03 am #687460
    John Moffat
    Keymaster
    • Topics: 56
    • Replies: 53169
    • ☆☆☆☆☆

    It is very common in the exam!

    The working capital is extra being held to finance the running of the business. It is not ‘used up’ and at the end of the project all of the working capital is recovered, as explained in my free lectures.

    June 29, 2023 at 8:25 pm #687517
    alawi sayed
    Participant
    • Topics: 212
    • Replies: 252
    • ☆☆☆

    If the working capital is not to be used and it is extra so why it is to be added then again it is recovered.

    Thanks for help Sir,

    June 30, 2023 at 12:34 pm #687531
    John Moffat
    Keymaster
    • Topics: 56
    • Replies: 53169
    • ☆☆☆☆☆

    The working capital is held in order to finance receivables, inventory etc.. At the end of the project it is no longer needed and is therefore recovered (and is therefore an inflow).

    Again, have you watched my free lectures on this? 🙂

  • Author
    Posts
Viewing 4 posts - 1 through 4 (of 4 total)
  • You must be logged in to reply to this topic.
Log In

Primary Sidebar

ACCA News:

 

ACCA Qualification syllabus changes for 2023/24

Need verifiable CPD for 2023? 21 units of FREE CPD on offer from ACCA

ACCA My Exam Performance for non-variant

Applied Skills exams is available NOW

NEW! Download the ACCA Pass Guide

ACCA mock exams and debrief videos

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

Subscribe to ACCA’s Student Accountant Direct

Specially for OpenTuition students

20% off BPP Books

Get BPP Discount Code

Donate

If you have benefited from OpenTuition please donate.

ACCA CBE 2023 Exams

Instant Poll * How was your exam, and what was the result?

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

PQ Magazine

Latest comments

  • nghja2012 on Inventory – Examples – ACCA Financial Reporting (FR)
  • kelems on Basic group structures – SPLOCI introduction and example – ACCA (SBR) lectures
  • jcosgrove16 on Double Entry Bookkeeping (part a) – ACCA Financial Accounting (FA) lectures
  • ayeodele on The management of receivables – Change of policy – ACCA Financial Management (FM)
  • Akhil004 on Discounted cash flow techniques (part 2) – ACCA (AFM) lectures

Copyright © 2023 · Support · Contact · Advertising · OpenLicense · About · Sitemap · Comments · Log in