Capital Budgeting

Ravi
Posts: 2
Joined: Sun Aug 04, 2013 4:56 am

Capital Budgeting

Postby Ravi » Wed Dec 17, 2014 8:33 pm

In case a new capital asset is purchased, extra working capital in required. So there is cash outflow. But why this same extra working capital will be treated as inflow at the end. My point is any extra working capital which is required will be used completely to make operation of new asset successful, so why inflow at the end with same working capital amount?

edupristine
Finance Junkie
Posts: 722
Joined: Wed Apr 09, 2014 6:28 am

Capital Budgeting

Postby edupristine » Thu Dec 18, 2014 7:58 am

Could you please elaborate this line with example" But why this same extra working capital will be treated as inflow at the end".


Return to “CFA Level I”



Disclaimer

Global Association of Risk Professionals, Inc. (GARP®) does not endorse, promote, review or warrant the accuracy of the products or services offered by EduPristine for FRM® related information, nor does it endorse any pass rates claimed by the provider. Further, GARP® is not responsible for any fees or costs paid by the user to EduPristine nor is GARP® responsible for any fees or costs of any person or entity providing any services to EduPristine Study Program. FRM®, GARP® and Global Association of Risk Professionals®, are trademarks owned by the Global Association of Risk Professionals, Inc

CFA Institute does not endorse, promote, or warrant the accuracy or quality of the products or services offered by EduPristine. CFA Institute, CFA®, Claritas® and Chartered Financial Analyst® are trademarks owned by CFA Institute.

Utmost care has been taken to ensure that there is no copyright violation or infringement in any of our content. Still, in case you feel that there is any copyright violation of any kind please send a mail to abuse@edupristine.com and we will rectify it.