[k1zuna]

my exam is tomorrow so any help is appreciated.

For NPV method, what do we do with final year working capital requirement decrease?

1. decrease in working capital x (T)

2. decrease in working capital x (1-T)

3. decrease in working capital

Becker’s question #CPA-03347 says we just do decrease in working capital…then multiply by PV factor. (???)

Thanks in advance.

FAR - Passed
AUD - Passed
BEC - Passed
REG - 8/22/2013

[Anonymous]

Yes, taxes are not considered since it is neither taxable cash flow nor deductible expenses. A reduction in working capital simply converts a current asset, receivables or the like, into cash. Thus, we only consider the cash inflow at its present value.

Hope this helps, I am taking BEC in an hour, wish me luck!

[Anonymous]

Yes, taxes are not considered since it is neither taxable cash flow nor deductible expenses. A reduction in working capital simply converts a current asset, receivables or the like, into cash. Thus, we only consider the cash inflow at its present value.

Hope this helps, I am taking BEC in an hour, wish me luck!

[k1zuna]

Thanks a bunch! Best of luck to you!

FAR - Passed
AUD - Passed
BEC - Passed
REG - 8/22/2013

[Author]

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