A company that pays $5,000 previously owed to one of its suppliers will see no change in its net working capital.

Name: A company that pays $5,000 previously owed to one of its suppliers will see no change in its net working capital.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

Net working capital is calculated by subtracting current liabilities from current assets. Since the payment of $5,000 to a supplier does not affect either current assets or current liabilities, there will be no change in net working capital.

A Company That Pays $5,000 Previously Owed to One of Its