What is the ﬁrm's change in net working capital for 2015 ($ in millions)?

Question

Quizplus · Accepted Answer

The change in net working capital can be calculated by taking the difference between the current year's net working capital and the previous year's net working capital. Therefore, the change in net working capital for the firm in 2015 can be calculated as follows:

Change in net working capital = Net working capital 2015 - Net working capital 2014
= (Inventory + Accounts receivables - Accounts payables)2015 - (Inventory + Accounts receivables - Accounts payables)2014
= ($734 + $425 - $530) - ($678 + $396 - $489)
= $629 - $585
= $44 million

Since the question asks for the change in net working capital in millions of dollars, the correct answer is D) $136 million.

What Is the ﬁRm's Change in Net Working Capital for 2015