Question Details

I need help figuring out the net working capital from year 1 to year 2 is closest to ___?

Cost of machine: $40000

Straight line of depreciation: 3 years

1st year sales: 2500

Sales growth each year: 8%

Price per cane: $14

Cost per cane: $8

Needs to hold: 4% cash, 5% accounts receivable, 8% inventory, 6% inventory.

Tax: 35%

Cost of capital: 8%