The change in net working capital regardless of whether an increase or decrease is not taxable because it merely involves a net build-up or reduction of current balance sheet accounts.

Question

Quizplus · Accepted Answer

The change in net working capital is not taxable because it is a result of changes in current assets and liabilities, which do not involve taxable transactions. It is simply a reflection of changes in the company's operating activities.

The Change in Net Working Capital Regardless of Whether an Increase