A Project Increases Accounts Receivable and Accounts Payable by $500,000

question 49

Multiple Choice

A project increases accounts receivable and accounts payable by $500,000.00 each. All other working capital accounts are unaffected. What is the project's effect on working capital?

• A)Working capital increases by $1 million.
• B)Cannot be calculated without considering accumulated depreciation.
• C)Working capital is unaffected.
• D)Working capital increases, but the amount cannot be determined.