Which of the following is correct with respect to working capital and capital budgeting?

Question

Quizplus · Accepted Answer

Working capital is a part of the capital budget and is considered in the cash flow analysis. However, it is assumed that the working capital will be recuperated at the end of the life of the project, making it a part of the terminal cash flow. Choices A, B, and D are incorrect because working capital is not ignored in the capital budgeting process, it does not have a different discount rate, and it does affect cash flow.

Which of the Following Is Correct with Respect to Working