Increases in working capital needs should be included as part of the initial outlay of a project,but decreases in working capital for a project should not be considered because they are not guaranteed.

Question

Quizplus · Accepted Answer

Decreases in working capital should be included as part of the initial outlay of a project because they reduce the amount of funds required to finance the project. It is also possible to forecast decreases in working capital with reasonable accuracy, particularly if the company has a stable operating history.

Increases in Working Capital Needs Should Be Included as Part